Magee Gammon Blog Tax Budget 2013

Budget 2013

In case you have been predisposed this week and missed The Budget – below is a brief overview. For a more in depth view you may like to take a look at our Budget Report

Summary of key proposals

  • Corporation Tax to be reduced by 1% to 20% by 2015.
  • New employment allowance to reduce National Insurance bills by £2,000 for every employer from April 2014, meaning 450,000 small businesses will no longer pay National Insurance.
  • Tax-free personal allowance to be increased to £10,000 from April 2014, a year earlier than planned.
  • Tax avoidance and evasion measures announced, including agreements with the Isle of Man and the Channel Islands.
  • Introduction of tax relief for investment in social enterprises.
  • Capital Gains Tax holiday to be extended for the Seed Enterprise Investment Scheme (SEIS) from April 2013.
  • An additional £3 billion a year to be invested in infrastructure from 2015/16, totalling £15 billion over the next decade.
  • New tax incentives for manufacturers of ultra-low emission vehicles, as well as a ‘generous’ new tax regime to encourage investment in shale gas.
  • Single flat-rate state pension of £144 a week to be brought forward to 2016, a year earlier than planned.
  • New ‘Help-to-Buy’ scheme offering equity loans worth up to 20% on newly built homes for anyone looking to get on the property ladder, while a new mortgage guarantee worth £130 billion will help those who cannot afford a large deposit.
  • Cancellation of September’s planned rise in fuel duty, while the planned rise for all alcohol duty will remain, with the exception of beer duty which will be cut by 1p from 24 March 2013.
  • Tax-free childcare vouchers worth £1,200 per child to be introduced.
  • New anti-avoidance rules to be introduced with immediate effect to tackle ‘bed and breakfasting’ of close company loans to avoid a S455 charge. New rules will also cover avoidance of a tax charge by lending the money to an intermediary.
  • Amendments to rules on the deductibility of liabilities in working out Inheritance Tax liability due on estates, which is likely to impact on individuals with EBT loans outstanding.

Please contact us if you would like advice on any changes arising from the Budget.

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