Little of substance

MHA MacIntyre Hudson

30th March 2015

Budget Review

IN George Osborne's final budget of this parliament, we were promised there would be no giveaways and no gimmicks. What we ended up with was a budget good for savers but with little or no other announcements of substance for the business community. While George Osborne's repertoire of jokes was brimming to the hilt, it would appear the same couldn't be said about the money left in the treasury's banks. On key business issues, such as the fall of Annual Investment Allowance from £500,000 to £25,000 for capital allowances, the answer was 'it will be substantially more than £25,000." This doesn't allow for good business planning when the limit will fall on 31 December 2015. Stability was, however, a central message coming out of the budget and there were few or no tweaks to current systems. While changes were made to entrepreneurs relief, these were to tackle known avoidance loopholes. The main help was for savers with the increased flexibility to ISAs and a new ISA product geared at homebuyers. There will be a new personal allowance for interest worth £1,000 for basic rate taxpayers (£500 for higher rate payers and £0 for additional rate tax payers). Personal allowances will also increase at rates above inflation for the next two tax years but with inflation so low, this was not seen to be overly generous. There will be some interest to the proposed changes to the annual tax return although the published details on these measures were very general and it is not evidently clear how this will be implemented. Changes to pensions were well documented in the pre-budget press and are broadly in line with offering alternatives to annuities whilst the continual squeeze on the maximum amount being able to be collated tax efficiently into a pension pot has once again been reduced to £1m. Rachel Nutt, Tax partner at Northampton based Chartered Accountants MHA MacIntyre Hudson welcomes the moves: "The business community will be buoyed that the UK recovery from the financial crisis has continued. While not all sectors will feel as optimistic, the economic outlook is looking brighter which should give business confidence for the future. While this was never going to be a detailed budget given its proximity to the election, the measures announced will allow business to carry on while the political establishment moves into election mode". If you would like to discuss any of these issues in more detail Rachel can be contacted on 01604 624011 or at rachel.nutt@mhllp.co.uk. You can also obtain a copy of MHA MacIntyre Hudson's Budget Summary online at www.macintyrehudson.co.uk/publications or by email to helen.woolf@mhllp.co.uk

MHA MacIntyre Hudson