Thursday, 29 July 2010

Budget June 2010 c

I'm really sorry, I can't access my own website at present - thanks geeks! - so publishing here so the info is out.

Government Abell Morliss Comment
Corporation Tax Rate to remain at 21% up to £300,000 profits
28% over that in current 10/11 year In 11/12 both rates drop by 1%. Good news if you make profits.
Rates planned to converge so by end of parliament we will have a single rate?

Income Tax Rates Lower Bands stay same:-
20% is the basic band for 10/11 up to £37,400, then 40% on excess
Plus 50% if you go over £150,000
NB. Savings income up to £2,440 (09/10 2,440) taxed at 10% still
But changes for 11/12 NB. Don’t forget that the effective max. rate of tax is already 40% plus 1% NIC making 41%. In 2010/11 Darlings last Budget introduced a 50% (+1%) on income above £150,000.

Also a sly reduction in personal allowance for incomes over £100,000

Personal Allowances Rate from 6.4.10
is un–changed at £6,475 In 11/12 it will go up to £7,475 (allegedly)

Notional Insurance No changes - 11% for serfs up to £44,000 salary, then only 1% everything above
12.8% paid by the rulers And in 11/12 it is 12% for the oppressed. Rulers will go up to 13.8% same date, despite previously announced as NOT going up !

But still NIC is not abolished !
It is crazy not to incorporate this into our standard tax systems. Government spouts about reducing red tape, and this would massively help business admin at the stroke of a pen, and we could re-deploy a bunch of pen-pushers

Capital Gains Tax Rate remains at 18% for standard rate tax-payers.
New immediate rate of 28% for those paying higher rate income tax
10% for selling business assets. And the lifetime limit for flogging business assets, up even higher from £1m. to £5m. This will cane 2nd home traders as the Gain will form part of the liability to higher rate calcs. E.g. Gain of £150k, and caramba! you are a Higher Rate person.

Our other views on CGT are controversial here, so no comment

Annual exempt amount un-changed at £10,100 This is another personal allowance if you can make the gains

VAT Up from 17.5% to 20% on 4th January 2011 Why delay from 1.8.10?
No change in the various exemptions

Inheritance Tax No new ‘initiatives’
Threshold un-changed at £325,000 But remember this is now available jointly with your partner so really the limit is now £650k.ish.
And HMRC alleges only 16,000 estates paid IHT in 2009 !

Capital Allowances £100,000 annual investment allowance for just 10/11

R&D allowance remains at 175% This is ‘French’ for 100% 1st year allowance on 1st £100k of Capital Investment, and is a fig leaf towards helping manufacturing, but really it needs to be £1m pa to be meaningful.
Instead of which the first dopey decision by our new government has been taken to REDUCE this to £25,000 from April 2012. So make sure your plant is purchased by 31.3.12
WDA remains at 20% But from 1/4/12 it is reduced to 18%

Vans Company Vans Still the best tax-free business perk going, thanks to Gordon’s changes a while back. Especially if you buy a double-cab pickup with CD multi-changer, climate control and leather seats - Dohh!

Insurance Premium Tax Lower rate 5%
Higher rate 17.5% From 4th January 2011 L=6% H=20%
TIP pay your insurances premiums in December 2010 !!

FUEL Fuel still going up 1p litre every few months to avoid us all getting a head of steam over being fleeced to the cleaners

BOOZE No changes except Cider Cider tax increase reversed on 30th June 2010 – buying votes in zoiderland?

FAGS No changes Ditto

Stamp Duty No new proposals
0% on up to £250,000 house sales.
1% £125k. up to £250,000
3% to £500,000
4% Beckhams You have to be a 1st time buyer to get up to £250k. at 0% - how will they check? Apparently the restriction applies even if you previously owned a mudhut in Eritrea!

Landfill Up another £8 tonne from April 2011 to £48 The minimum rate from April 2014 is set at £80 tonne
A massive increase that skimmed under most peoples’ radars

Council Tax Allegedly no increases for anyone in 11/12

ISA The annual allowance is up to £10,200 (£7,200) …but it’s pointless saving with interest rates soooo low.

Civil Service Continued headcount reductions in next few years We are paying a fortune for semi-employed civil servants with little to do, so the axe is being wielded – or so Government says. Quite how it is to be done is most intriguing…will need a good statistician to ‘prove it’.
And 15,000 of the 45,000 overheads in London are being binned to the provinces to:-
a] save money on expensive London office property costs
b] get the horrors out of London
c] save money by them not getting their cushy London c.o.l. allowances
d] ‘exporting’ unemployment from Bootle/Newcastle to London

Enterprise The usual warm words

Pensions Higher-rate relief on contributions abolished for 2010/11+ What about withdrawing Corporation Tax relief on Goodwinesque contributions by employers ?– that’s who we should be clobbering big time.

PSBR The mountain for 2010/11 is guessed at £150 billion And for loads more years to come, and then when we’ve finished borrowing this ridiculous money, we have to start slooooowly paying it back.

Budget June 2010 b

The following notes should be read in context of the last Spring Budget presented by Alistair Darling. The current year tax changes are actually very few indeed. It is mainly in-year spending reductions he is trying for as a way of nailing his colours to the mast early on.
Also bear in mind we have TWO more budgets before 11/12 tax year starts so it’s anyone’s’ guess really what the rates will be when reality happens.

Item When?
• VAT up to 20% 4/1/11
• IPT up 1%/2½% 4/1/11
• CGT 28% rate for higher rate tax-payers 22/6/10
• Bank Levy 0.04% of balance sheet if you are over £20bn 1/1/11
• Cider Duty increase cancelled “from 30.6.10”
• Landline Duty abolished before it started
• And there were some current year spending reductions announced a few days ago

Budget June 2010 a

Government Budget Statement
Summer 2010 – number 01 (of a new series)

“Responsibility, freedom, fairness: a five year plan to re-build the economy” – says Mr. O

…..…the last shower screwed up biiiig time, and I’m going to fix it ASAP - everyone’s going to hate the solution – but at least I can smile nicely while snipping bits off your bank balance

We set out below comments on the Emergency Budget presented by our shiny new Chancellor in June 2010. The Budget was a refreshing change of style from the last xx years of waffle, but whether it will work is of course up in the air.

The good news is for businesses making massive profits as their tax rate will drop by 1% pa. for at least 4 years.
The bad news is for alcohol-drinking, smoking, disabled, housing benefits claimants with several teenage children as they are being clobbered big time from next April+.

We remind you of a quote from ONS ( UK Office for National Statistics ) “The public sector recorded deficits between 1991/92 and 1997/98 before moving into surplus in 1998/99. Deficits have been recorded since 2002/03.”
So what went wrong from 02/03+? Why did Gordon B recklessly start running deficits in 2003 onwards??, and no one said “this is madness Gordon, get a grip”.
And the thing we don’t get a clear explanation on is :- what is it that is actually driving this massive PSBR surge for several tax years? Think it through – the dozy banks screwed up biiiig time so we nationalized them / bought shares in them / lent massive amounts of dough to them all amounting to £billions. Yep all fine, but that’s a one-off, what’s pushing the borrowing in 2010/11 onwards? It seems some of the answer lies in the massive increase in the Benefits payments in the last few years together with big increases in Education and the NHS without regard for how the money was going to be found.
The only real hope is that the ‘astute investments’ in the bombed-out British banks come good, and we can flog the shares for massive profits in about 4 years time to pay it all off. Otherwise plan B is that we will have a PSDR liability of £10bn. per year for the lifetime of our grandchildren.