This week’s Emergency Budget was awaited by businesses with baited breath and the results received a mixed response.
In brief, here is a breakdown of the key changes which are likely to affect your business:
- VAT will increase from 17.5% to 20% from January 4th 2011
- The small companies' tax rate will be cut to 20%
- Personal income tax allowance will increase by £1,000 in April to £7,475 taking around 880,000 of the lowest-paid workers out of income tax altogether
- Entrepreneurs setting up new businesses outside London, the Southeast and East of England will be exempt from £5,000 of National Insurance for the first 10 staff they hire
- Capital Gains Tax rose at midnight on Tuesday from 18% to 28% for higher rate taxpayers and entrepreneur’s relief rate of 10% on the first £2million of gains will be extended to the first £5million
- From April 2011, the threshold at which employers start to pay National Insurance will rise by the rate of inflation plus £21 per week
- Corporation Tax will be cut next year to 27%, and by 1% annually for the next three years, until it reaches 24%.
Our team of Commercial law partners are here to assist with all aspects of your business needs, with specialists in Corporate and Commercial transactions, Commercial disputes, Commercial Property, Debt Recovery, Employment advice and much more.