If you missed the Budget on Wednesday, here’s a summary of George Osborne’s announcements and how they could affect you:
Children & Parents
- All public schools to become Academies by 2020
- School hours for secondary schools to be extended to include sport and other activities
- Maths to be taught to age 18
- Sugar levy to be introduced by 2018, manufacturers could pass price increase down to consumers
- Money raised from the sugar tax (estimated £520m) will be spent on sport in schools
- LIBOR fines will be donated to help with children’s hospital services in Manchester, Sheffield, Birmingham and Southampton
Workers
- Personal tax allowance will increase to £11,500 for basic rate taxpayers and £45,000 for higher rate taxpayers from April 2017 (a big step towards £12,500 by the end of this Parliament)
- Lifetime ISA – if you were born after 1977 you can save up until you are 50 and for every £4 you pay in, the government will pay in £1; up to a maximum od £4,000 per year (launching April 2017)
- ISA limit increasing to £20,000 from April 2017 (practically making the Lifetime ISA an additional allowance on top of your current one)
Business Owners & Self Employed
- Small business rate relief will be raised from £6,000 to a maximum threshold of £15,000, higher rate threshold will rise from £18,000 to £51,000
- Simplification of business rates
- Capital Gains Tax will be cut by 8% from April 2016 – basic rate from 18% to 10%, higher rate from 28% to 20%
- Class 2 National Insurance Contributions scrapped from 2018, meaning a tax cut of £130 for 3 million self-employed
- Commercial Stamp Duty now 0% up to £150,000, 2% on the next £100,000 and 5% on anything over £250,000
- New 2% rate on high value leases with a net present value above £5m
- Corporation Tax will be reduced to 17% by 2020
- Tax free allowances of £1,000 per year for micro-entrepreneurs selling services online or renting out their homes through the internet (e.g. via Airbnb)
Women
- VAT from sanitary products (the Tampon Tax) will be used to support women’s charities – £12 million will go to causes such as Breast Cancer Care and the White Ribbon Campaign
Northerners
- Green light for HS3 Manchester to Leeds, a 4 lane M62 and a review of plans for a new tunnelled road from Sheffield to Manchester
- Over half of the population of the Northern Powerhouse will be able to elect a mayor from next year (Manchester, Liverpool, Tees Valley, Newcastle and Sheffield
Everyone
- Fuel duty has been frozen for the 6th year in a row, saving drivers an average of £75 a year according to Osborne
- Beer, cider and spirits duties have been frozen too, all other alcohol duties will rise in line with inflation
- Tobacco duty to rise by 2%, and hand-rolling tobacco will rise by 3%
- £700m to be spent on flood defence schemes across York, Leeds, Calder Valley, Carlisle and Cumbria
- Insurance Premium Tax to increase by 0.5% to fund the flood defence schemes
- £115m to support the homeless and reduce rough-sleeping
- £730m to back renewable technologies
- Carbon Reduction Commitment abolished and Climate Change Levy to rise from 2019 (Steel industry will be protected)
The rest of the UK
- Devolution of powers to Scotland, Wales and Northern Ireland
- Severn bridge toll to be halved from 2018
- £4m invested in the first Air Ambulance service for Northern Ireland
- Supplementary Charge on oil and gas to be cut by 10% and Petroleum Revenue tax abolished, both to be backdated to January 1st
If you’d like to discuss how these changes could affect you, your family and your business then get in touch with us and we’ll be happy to help.
Check out the Full Budget Report here.
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