Maslins Budget 2010 Summary

Personal Taxes

Income Tax

No significant new announcements, but rises announced previously are still to kick in.

Income between £100,000-£112,950 is effectively taxed at 60% (due to reduction in personal allowance).

National Insurance

From April 2011 employers rate to increase 1% to 13.8% and employees rate also to increase 1% to 12% (2% on earnings above upper threshhold).

Capital Gains Tax

No changes to the main rate (18%), and the limit for entrepreneur's relief will increase from £1m to £2m. Gains on qualifying business assets up to £2m now subject to an effective 10% CGT.

Bankers bonus tax

Those much loved bankers have had a further tax levied on their recent bonuses. This is paid by the company, and has already yielded £2bn.

Savings

ISA annual subscription limit increasing to £10,200 (of which £5,100 can be cash).

Going forward these will increase in line with the retail price index (measure of inflation).

Pensions

From April 2011 individuals with total income over £150,000 (INCLUDING employer pension contributions) will have reduced relief for pension contributions, or be subject to benefit in kind treatment on employer contributions.

Inheritance Tax

The nil rate band for inheritance tax will remain at £325,000 for the foreseeable future.

Corporate Taxes

Annual Investment Allowance

This will be increased to £100,000 from April 2010 (previously £50,000). NB this still specifically excludes cars.

Zero/Low Emission Vehicles

100% first year allowances for zero emission vehicles (eg electric cars) from 2010-2015.

No benefit in kind for employees provided with zero emission van/car.

5% benefit in kind for employees provided with cars producing less than 75g/km.

Indirect Taxes

VAT

Some Royal Mail postal services will be subject to 17.5% VAT (previously exempt). This will not apply to standard first/second class letters, but will apply to some parcels.

VAT registration threshhold increased to £70k (from £68k).

Stamp Duty

First time buyers will not have to pay any stamp duty land tax (SDLT) on properties under £250k.

Residential properties selling for over £1m will be subject to 5% SDLT from April 2011.