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Steve Vickers, Tax Partner
Sheffield based chartered accountants Hart Shaw say many businesses could benefit from some of the measures introduced in the Budget.
George Osborne’s “Budget for a Resilient UK” outlined a number of new measures, while also welcoming significantly improved growth forecasts, with the UK economy expected to grow by 2.7% in 2014.
Although the surprise announcement that the Annual Investment Allowance (AIA) for capital expenditure has been doubled from £250,000 to £500,000 will not affect most small and medium-sized businesses, those with heavy capital investment plans will be cheered and the vast majority of businesses will now get 100% up-front relief on qualifying investment in plant and machinery.
Osborne also pledged to cut energy costs for manufacturers by capping the Carbon Price Floor, while R&D tax credits to loss making companies will be raised from 11% to 14.5% from April 2014.
As widely expected, measures were announced to raise the amount of income people receive tax-free to £10,500 from 2015.
For individuals radical changes were announced to pensions and savings. As well as a move to merge cash and stocks and shares ISAs with an upper limit of £15,000, Osborne announced the reduction from 10% to 0% of the starting rate of tax for savings and an extension of the band to a maximum of £5,000.
Changes to pensions include the introduction of new pensioner bonds and the removal of all tax restrictions on pensioners’ access to their pension.
Steve Vickers, Tax Partner at Hart Shaw said: “This was certainly a Budget setting out the Government’s agenda for the next election, with many measures announced to help businesses and individuals alike.
“Crucially businesses will be able to increase investment in infrastructure through the AIA, while energy-bills will be reduced thanks to the scrapping of green levies.
“Pensioners and savers will also be cheered through some radical, and surprising, measures.
“As always we would urge all businesses and individuals to study the small print to see what announcements will affect them and contact an accountant for further advice on how to make the most of these opportunities.”
Steve Vickers can be contacted on T: 0114 251 8850 or email: firstname.lastname@example.org.