Emergency Budget

By LBV

23 Jun 2010

The Emergency Budget saw VAT go up to 20 per cent and Capital Gains Tax hiked to 28 per cent.

But with concessions for businesses such as a minimal drop in Corporation Tax and National Insurance relief for small start-up firms, there is a feeling that Chancellor George Osborne achieved an acceptable balance when it came to wielding the fiscal axe.

Jane Parry, tax partner at PM and M, Blackburn, said the Budget was not as harsh as expected.

She added: “With regards to income tax, it was not possible for Nick Clegg’s dream of a £10,000 personal allowance to be realised, but some initial steps towards it were taken by increasing the personal allowance by £1,000 to £7,475, thus taking a further 880,000 people out of income tax.

“Higher earners will not see the benefit of this as the rules introduced in April which see the personal allowance start to disappear for taxable incomes over £100,000 still remain.

“For business there was good news in that the rates of Corporation Tax on profits are set to reduce, starting in April 2011. This was tempered a little by reductions in capital allowances rates from 2012, but overall is good news for companies recovering from the recession and looking to keep hold of as much of their hard earned profits as they can.

“There were also announcements on reducing the cost of employing people by increasing the employers’ National Insurance contributions threshold and also providing some exemptions for new businesses starting to employ people. This could be helpful for anyone leaving the public sector and looking to set up their own business.”

Colin Tice, head of taxation department at Cassons chartered accountants and business, also believes there were some positives to be taken from Osborne’s speech.

He said: “Individuals face a significant tax increase on their capital gains, up to 28 per cent from the previous 18 per cent. Business owners are protected by extending the lifetime Entrepreneur’s Relief cap to £5m with an effective tax rate of 10 per cent.

“Whether that is sufficient not to discourage venture capital investment remains to be seen. This is supposed to be a measure to stop the avoidance of Income Tax by the conversion of income into capital gains which are taxable at a much lower rate.

“The differential between the highest income tax and capital gains tax rates remains significant so it is difficult to see how that is the case.

“On a brighter note, the long running fiasco on the taxation of furnished holiday lettings is brought to an end by the Chancellor reverting to the original rules and so these businesses can continue to be taxed more favourably as businesses rather than as investments. But even here further amendments to the rules are expected over the summer.”
 

Enjoyed this? Read more from LBV

Latest news

1

Work begins on £3m youth zone expansion Blackburn Youth Zone Rosslee Construction

Work begins on £3m youth zone expansion

11 Jul 2024

2

Employment initiative launched at careers conference Careers Hub Event

Employment initiative launched at careers conference

09 Jul 2024

3

Counties need to get real on mayors frank-mckenna-1000x500.jpg

Counties need to get real on mayors

12 Jul 2024

4

New manager takes the helm at Conkers Day Nursery in Langho Katie Twine manager at Conkers.jpg.jpg

New manager takes the helm at Conkers Day Nursery in Langho

12 Jul 2024

5

Farleys assists Basically Cheer and Fitness with new lease in Burnley Parkside Methodist Church.jpg.jpg

Farleys assists Basically Cheer and Fitness with new lease in Burnley

12 Jul 2024

Bec Web Strip 980x120
Background image for hub sign up block

LBV Hub

Leverage Lancashire Business View platforms

Post your news
Post your events
Post your offers
Build your network
Improve your SEO
Gain coverage in the magazine
Sign-up
Events
Lancashire Built Environment Conference
BEC 315 X 315 Px
Networking
25 Sep 2024

Lancashire Built Environment Conference

Conference and Exhibition Centre, Winter Gardens Blackpool, FY1 1HL

08:30 - 13:00

RISE - The Academy for Female Leaders and Managers
WENDY BOWERS RISE Illustrstion copy.jpg.jpg
LBV Hub Seminars
11 Jun 2024 - 04 Dec 2024

RISE - The Academy for Female Leaders and Managers

East Lancashire Chamber of Commerce, Clayton le Moors, BB5 5JR

09:00 - 16:30

LBV117 Magazine Launch Event
DSC9389
Networking
16 Jul 2024

LBV117 Magazine Launch Event

Blackburn Rovers Football Club, Blackburn, BB12 9EE

16:00 - 18:00

A Freelancers Introduction to Co-ops with John Atherton
Screenshot 2024-06-13 at 13.59.57.png.png
LBV Hub Seminars
17 Jul 2024 - 17 Jul 2024

A Freelancers Introduction to Co-ops with John Atherton

Society1 Coworking Space, Preston, PR1 3LT

14:00 - 16:00

The Business Network Central & East Lancashire
LBV Header (10).png.png
LBV Hub Networking
18 Jul 2024 - 18 Jul 2024

The Business Network Central & East Lancashire

Mytton Fold, Langho, BB6 8AB

11:30 - 14:15

Conversations in Creativity - Creative Networking Event
Untitled design-4.png.png
LBV Hub Networking
18 Jul 2024

Conversations in Creativity - Creative Networking Event

Society1 Coworking Space, Preston, PR1 3LT

17:30 - 19:30

Lancashire Economic Breakfast
LBV Hub Seminars
18 Jul 2024

Lancashire Economic Breakfast

The Mill, St Catherine's Park, Preston, Lancashire

07:15 - 09:00

Preston Freelancer MeetUp and Coworking Day
Screenshot 2024-06-13 at 13.55.10.png.png
LBV Hub Networking
30 Jul 2024

Preston Freelancer MeetUp and Coworking Day

Society1 Coworking Space, Preston, PR1 3LT

10:00 - 12:00

Chamber Breakfast Networking
Chamber Logo1.png.png
LBV Hub Networking
31 Jul 2024

Chamber Breakfast Networking

Pye Motors, Morecambe, LA3 3PF

08:00 - 10:00

Scaling your revenue: From zero to £1m in 60 months
CBP-logo LBV.png.png
LBV Hub Webinar
31 Jul 2024

Scaling your revenue: From zero to £1m in 60 months

Online, Online, Online

08:00 - 09:30

Online Women's Health Clinic
clinic.png.png
LBV Hub Webinar
06 Aug 2024

Online Women's Health Clinic

x, Online, x

12:00 - 12:00

International Coworking Day Open Day
1.png.png
LBV Hub Social
09 Aug 2024 - 09 Aug 2024

International Coworking Day Open Day

Society1 Coworking Space, Prestin, PR1 3 LT

10:00 - 13:00

Advertise with us

Reaching 50,000 members, our print, digital and event platforms offer a fantastic way to raise your business profile and help you grow.

Find out more LBV116 Online Graphic
Subscribe now

Weekly news bulletin