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2014 Budget in Brief ….

PERSONAL TAXATION & SAVINGS ….

Personal tax allowance to be raised to £10,500 next year, resulting in £800 income tax reduction for typical taxpayer.

Transferable tax allowance for married couples to rise to £1,050.

Cash and stocks ISAs to be merged into single New ISA with annual tax-free savings limit of £15,000 from July 1. Limit for Junior ISA raised to £4,000.

New Pensioner Bond paying market leading rates to be available from January to all over 65s, with possible rates of 2.8 per cent for one-year bond and 4 per cent for three-year bond.

Cap on Premium Bonds to be lifted from £30,000 to £40,000 in June and £50,000 in 2015, and number of £1million winners to be doubled.

PENSIONS

Tax on cash taken out of pension pot on retirement to be reduced from 55 per cent to 20 per cent.

All tax restrictions on pensioners’ access to their pension pots to be removed, ending the requirement to buy an annuity. £20million fund to develop new free right to advice for those retiring on defined contribution pensions.

Abolition of 10p starting rate of tax on income from savings.

BILLS

Fuel duty rise planned for September ‘will not take place’.

Duty on fixed odds betting terminals increased to 25 per cent, horse racing betting levy extended to offshore bookmakers and bingo duty halved to 10 per cent.

Tobacco duty to rise by 2 per cent above inflation, and the escalator extended for the rest of the next Parliament.

Alcohol duty escalator scrapped, so taxes will rise in line with inflation except for on whisky and other spirits, where it is frozen.

Duty on ordinary cider frozen. Beer duty cut by 1p a pint.

A £7billion package to cut energy bills includes £18 per ton cap on carbon price support rate from 2016 to the end of the decade, saving medium-sized manufacturer £50,000 and families £15 a year.

WELFARE & TAX AVOIDANCE

Welfare cap set at £119billion for 2015/16, rising to £127billion by 2018/19, with only the state pension and cyclical unemployment benefits excluded.

Tax on homes owned through a company to be extended from residential properties worth more than £2million to those worth more than £500,000. Residential property worth more than £500,000 bought through corporate envelope to be liable to 15 per cent stamp duty.

Inheritance tax waived for emergency services personnel who ‘give their lives protecting us’. VAT waived on fuel for air ambulances and inshore rescue boats.

BUSINESS MEASURES

Reform of air passenger duty so all long haul flights carry the same tax rate as currently charged for flights to USA.

OBR revises down forecast tax receipts from North Sea oil and gas by £3billion.

Housing policies announced today to support more than 200,000 new homes.

Additional £140million made available for repairs and maintenance to flood defences. Additional £200million for potholes.

Annual investment allowance doubled to £500,000 and extended to the end of 2015.

The 2 per cent increase in company car tax to be extended to 2017 and 2018, with increased discount for ultra-low emission vehicles.

ECONOMY & BORROWING

Office for Budget Responsibility confirms economy grew by ‘three times as much’ as forecast 0.6 per cent in 2013.

OBR predicts 2014 GDP growth of 2.7 per cent, then 2.3 per cent in 2015, 2.6 per cent in 2016 and 2017, and 2.5 percent in 2018.

Borrowing expected to be £108billion this year – £12billion less than forecast a year ago.

OBR predicts borrowing will fall to £95billion in 2014/15, then £75billion, £44billion and £17billion in subsequent years with a surplus of almost £5billion in 2018/19.

Borrowing forecasts mean the UK will borrow £24billion less than previously predicted over the period.

OBR revises down national debt to 74.5 per cent of GDP this year, then 77.3 per cent next year, reaching a peak of 78.7 per cent in 2015/16 and falling to 78.3 per cent, 76.5 per cent and 74.2 per cent in following years.

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