Pre Budget Report 2008
Below are highlights of the Chancellor's Pre Budget Report released yesterday. For further details, please visit the resource section on the website of Brewers, our chartered accountancy business, by clicking here.
2008 Pre Budget Report highlights
∗VAT is to be cut as of 01 December to 15 per cent until the end of 2009, but duties on petrol, alcohol and tobacco to rise to offset the reduction
∗Increase of £610 in personal allowance to be made permanent. Personal allowance for next year to be £6,475. Restrictions apply for high earners from 2010/11
∗National insurance to rise by 0.5 per cent on all rates of National Insurance from 2011
∗Top rate of Income Tax to increase to 45 per cent on earnings above £150,000 from 2011
∗Air Passenger Duty to involve higher charges for longer flights
∗New car tax fuel efficiency bands still to be introduced, but at a more gradual pace, with a top increase next year of £5
∗Consultation on the wording of a Taxpayers' Charter to begin in January
Business
∗Rise in small company Corporation Tax from 21 per cent to 22 per cent to be deferred for one year
∗Businesses to be allowed to spread tax payments over longer periods of time
∗No legislation to be introduced on income shifting in the 2009 Finance Bill, but the issue is to be kept under review
∗£1 billion to be set aside to help small business borrowing by means of a temporary small business lending scheme
∗£1 billion to help exporters via the export credit guarantee department
∗Rise in the threshold on duty payable on empty business premises
∗Watchdog to monitor bank business lending
∗Introduction of a three-year carry back for trading losses for one year, capped at £50,000
Mortgages
∗Lenders to wait three months in the case of defaulted payments before pursuing repossession
∗Ceiling at which homeowners who lose their jobs can apply for help with mortgage payments to rise to mortgages worth £200,000
Families
∗Increase in Child Benefit to come into effect in January instead of April 2009
∗Pensioners to get above-inflation increases in pension payments, up from £124 to £130
a week for couples and from £89 to £98 a week for individuals
Government spending
∗£3 billion of capital expenditure scheduled for 2010/11 to be brought forward to this year; funds are to be spent on roads, schools, social housing and new energy measures
Government borrowing
∗Public borrowing set to climb to £78 billion this year and £118 billion next year, and to fall back to £54 billion by 2014
∗Debt as a proportion of GDP to reach 57 per cent by 2013/14
∗Policy of borrowing only to invest over the economic cycle will not be reintroduced
until 2015/16
Growth
∗Forecast for 2009 puts UK economic contraction at between -0.75 per cent and -1.25
per cent
∗Forecast for 2010 puts UK economic growth at between 1.5 per cent and 2 per cent
For more information, or if you have any questions, please contact one of our advisers on:
T: 01483 205890
2008 Pre Budget Report highlights
∗VAT is to be cut as of 01 December to 15 per cent until the end of 2009, but duties on petrol, alcohol and tobacco to rise to offset the reduction
∗Increase of £610 in personal allowance to be made permanent. Personal allowance for next year to be £6,475. Restrictions apply for high earners from 2010/11
∗National insurance to rise by 0.5 per cent on all rates of National Insurance from 2011
∗Top rate of Income Tax to increase to 45 per cent on earnings above £150,000 from 2011
∗Air Passenger Duty to involve higher charges for longer flights
∗New car tax fuel efficiency bands still to be introduced, but at a more gradual pace, with a top increase next year of £5
∗Consultation on the wording of a Taxpayers' Charter to begin in January
Business
∗Rise in small company Corporation Tax from 21 per cent to 22 per cent to be deferred for one year
∗Businesses to be allowed to spread tax payments over longer periods of time
∗No legislation to be introduced on income shifting in the 2009 Finance Bill, but the issue is to be kept under review
∗£1 billion to be set aside to help small business borrowing by means of a temporary small business lending scheme
∗£1 billion to help exporters via the export credit guarantee department
∗Rise in the threshold on duty payable on empty business premises
∗Watchdog to monitor bank business lending
∗Introduction of a three-year carry back for trading losses for one year, capped at £50,000
Mortgages
∗Lenders to wait three months in the case of defaulted payments before pursuing repossession
∗Ceiling at which homeowners who lose their jobs can apply for help with mortgage payments to rise to mortgages worth £200,000
Families
∗Increase in Child Benefit to come into effect in January instead of April 2009
∗Pensioners to get above-inflation increases in pension payments, up from £124 to £130
a week for couples and from £89 to £98 a week for individuals
Government spending
∗£3 billion of capital expenditure scheduled for 2010/11 to be brought forward to this year; funds are to be spent on roads, schools, social housing and new energy measures
Government borrowing
∗Public borrowing set to climb to £78 billion this year and £118 billion next year, and to fall back to £54 billion by 2014
∗Debt as a proportion of GDP to reach 57 per cent by 2013/14
∗Policy of borrowing only to invest over the economic cycle will not be reintroduced
until 2015/16
Growth
∗Forecast for 2009 puts UK economic contraction at between -0.75 per cent and -1.25
per cent
∗Forecast for 2010 puts UK economic growth at between 1.5 per cent and 2 per cent
For more information, or if you have any questions, please contact one of our advisers on:
T: 01483 205890