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Budget 2014 – Movers, Doers and Savers

Budget 2014 – Movers, Doers and Savers

George Osborne’s budget 2014 speech delivered more changes than had been initially expected.  There were some nice surprises (e.g. the AIA increase) however some of the announcements will take some time before we see the benefit.

Coined by Mr Osborne as a budget for the Movers, Doers and Savers the key highlights are worth a review to see which apply to you:

Corporation tax

  • Annual Investment Allowance (AIA) to double from £250,000 to £500,000 and extend to 31 December 2015
  • R&D tax credit relief for loss making companies to increase from 11% to 14.5% on 1 April 2014
  • Corporation tax for large companies reducing from 23% to 21% on 1 April 2014 and to 20% on 1 April 2015 to align with small companies rate

Personal  / PAYE taxes

  • Personal Allowance to rise from £9,440 (2013/14) to £10,000 (2014/15)
  • Income tax band at which pay 20% income tax to reduce from £32,010 (2013/14) to £31,865 (2014/15)
  • NIC allowance available against first £2,000 of employer’s NIC paid during 2014/15 and onwards
  • Under 21s to be removed from NICs from April 2015
  • Married couples/civil partners to be able to transfer between them up to £1,050 of personal allowance from April 2015 where both are basic rate tax payers

Pensions and savings

  • ISAs – individual tax free limits for stock/shares ISAs and cash ISAs scrapped and replaced by single £15,000 tax free limit on 1 July 2014
  • Savings starter rate to reduce from 10% to 0% and be available on first £5,000 of savings from April 2015
  • Pension drawdown restrictions loosening from 27 March 2014
  • New Pensioner Bond paying market leading rates to be available from January to all people over 65
  • Pension scheme annual contributions relief cut from £50,000 (2013/14) to £40,000 (2014/15)
  • Pension scheme tax-free lifetime allowance for the value of your pension pot cut from £1.5m (2013/14) to £1.25m (2014/15)

Other

  • 15% SDLT to be applied to residential property purchased through a company were property cost £500,000 and is purchased on/after 20 March 2014; £2m threshold currently applies to such purchases pre-20 March 2014
  • SEIS scheme time limit removed to make permanent the income and capital gains tax reliefs available from 2014/15 onwards
  • Capital gains tax relief on last 36 months of residential property that has been your main residence at some point reducing to 18 months from April 2014

VAT

  • Increase in VAT registration limit to £81,000 from 1 April 2014 (was £79,000)
  • Relief for air ambulance fuel announced
  • Change in place of supply rules for electronically provided services announced
  • Proposed change to prompt payment discounts
  • Proposed changes to VAT avoidance disclosure regime

Watch this space for more detail on the individual reforms and email taxchat@revellward.co.uk if you would be interested in attending our Breakfast Budget Seminar on Friday and/or to receive the Seminar Slides.

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