Budget Presents Welcome Measures to Help Businesses
28th March 2012
Sheffield based Chartered Accountants Hart Shaw is advising businesses and individuals to review their financial affairs closely, after the Chancellor introduced a number of measures in his 2012 Budget.
The Chancellor promised his budget would -unashamedly back business as he cut Corporation Tax to 24% next month, while there will be consultations on allowing small businesses with turnovers up to £77,000 to be taxed on the basis of the cash going through the firm. Mr Osborne also pledged to increase the £1bn Business Finance Partnership by 20%. The Budget also saw the implementation of tax relief for the video games, animation and high end television production sectors, while the Government is considering enterprise loans for young people to start their own business. Extra funding will also be available to help construction firms build new homes. However the Chancellor also promised to crack down on tax avoidance, introducing a new General Anti-Tax Avoidance Rule (GAAR) by 2013 and a stamp duty level of 7% on homes worth more than £2m, while companies that buy any such homes will pay a 15% stamp duty level. A new cap is also being introduced on tax relief's, with a cap of 25% of total income for anyone claiming more than £50,000 in a year. Perhaps the most controversial announcement made in the Budget was cutting the top rate of tax from 50p to 45p, with Mr Osborne telling the House 50p income tax rate was "harming the British economy" and was costing the taxpayer as money was moved to avoid the levy. Mr Osborne also raised the personal income tax allowance to £9,205 from April 2013. Steve Vickers, Tax Partner at Hart Shaw comments We are encouraged by the moves to support businesses, particularly in a time of -austerity but we are less enthusiastic about the effect the budget will have on individuals.