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21st March 2014

Summary of the Budget

Filed Under: Tax


Following on from the Chancellor’s Budget Statement I have posted a summary of some of the key points below, together with a PDF of THL’s full Budget summary. 

Click here to view:  2014 THL Budget Summary

State of the Economy

Growth is predicted to be 1.8% in 2014 rising to 2.8% in 2017.  As a result, George Osborne says the deficit as a share of GDP will fall from 7.4% in 2013/14 to 5% in 2015/16.

Debt as a share of GDP to increase from 75.9% this year to 85.6% in 2016/17.

600,000 more jobs expected this year than at same time last year.

Income Tax

The limit at which individuals start paying tax is to be raised to £10,000 from 6th April 2014.  This is expected to be further increased to £10,500 from 6th April 2015.

The basic rate of tax is currently 20%. The band of income at this rate is being reduced from £32,010 to £31,865.

The threshold at which the 40% band applies will rise from £41,450 to £41,865.

From April 2015 married couples and civil partnerships may be eligible for a new transferable allowance.

Other Individual Issues

New Tax-Free Childcare Scheme, £10,000 per child saving 20% tax from autumn 2015.

Individual savings account from 1 July 2014 will have an overall annual subscription of £15,000 for both cash and shares.

National Insurance

A new National Insurance allowance of £2,000 per year for all employers to offset against Class 1.

From April 2015 employers NIC abolished for under 21s.

Pensions

There are to be major reforms in the way retiring individuals can take their pension pots from April 2015, giving far greater flexibility.

Single flat-rate pension of £144 a week brought forward a year to 2016.

Other Issues

Full rate of corporation tax to be cut from 21% to 20% in 2015.

Annual Investment Allowance (AIA) is to be increased to £500,000 from April to 31 December 2015.

Shared equity schemes extended, with interest-free loans for homebuyers of up to 20% of value of new-build properties.

If you would like to discuss any of the points above or in our full budget summary in more detail please get in contact with me.

Daniel Langridge
daniellangridge@thlaccountancy.co.uk
01903 300230

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