How the March Budget 2015 Affects You

Editor's Notes

Whilst many of the changes coming into effect from April 2015 were announced previously in the December 2014 Autumn Statement, one or two additional changes were announced in respect of changes to ISA’s from Autumn 2015. However, no doubt that the big headline grabber will be the future planned abolition of the annual tax return regime.

As you may expect, many of the announcements made in the 2015 Budget had more than an eye on the upcoming General Election so many announcements suggest changes to be made in the next Parliament.

The team at A4G are devoted to keeping up to date with the latest economic developments and communicating the possible impact to our clients. Given the decidedly rosy picture painted by Mr Osborne, do you feel that your business is ‘walking tall’ again – incidentally the subject of our April 2014 seminar!

In order to achieve our mission statement of being the best all-round advisers to owner-managers we have sorted through the budget report to highlight the areas of importance to you and your businesses.

 

Overview

According to George Osborne, ‘Britain is Walking Tall Again’, although the job is not yet complete with some austerity measures still to be part of the financial landscape until 2019/20, including further cuts to public spending.

Based on figures produced by the Office for Budget Responsibility and quoting the OECD, Britain was announced as being the fastest growing of the larger European economies last year, and is on track to knock Germany off top spot as the largest European economy within 15 years. Will the national football team’s fortunes follow suit?!

With the current low inflation rate and high employment rates, the coalition was happy to say that living standards are now higher than at the last General Election. A Budget surplus, albeit smaller than predicted at the 2014 Autumn Statement, remains the target for 2018/19.

Of course, George Osborne reminded us that despite the apparently rosy view of the UK economy, there remains threats on the horizon with a nod to the potential stability issues in the Eurozone and the World as a whole.

Issues Affecting Owner Managed Businesses

  • Optimal drawings strategies for owner-managers
  • Making use of the new tax-free savings rate
  • Death of the Tax Return?
  • Tackling ‘False Self-Employment’
  • Employer’s National Insurance Exemptions
  • Purchasing Assets - Annual Investment Allowance (AIA)
  • Research and Development Tax Relief
  • Are Company Cars a good idea?

Read in further depth about the effect on owner managed businesses

 

Other announcements and new legislation

  • Pension Freedom
  • Pension Lifetime Allowance
  • Pension Annual Allowance
  • ISA Flexibility
  • Help to Buy ISA’s
  • Personal Savings Allowance
  • Fuel, alcohol and tobacco duties
  • Ebbsfleet Garden City Proposals

Read in further depth about the other announcements  from the 2015 Budget

Reaction to the Chancellor's speech

‘We took difficult decisions in the teeth of opposition and it worked. Britain is walking tall again.’

George Osborne, Chancellor of the Exchequer


‘This is a budget people won't believe from a government that is not on their side - because of their record, because of their instinct, because of their plans for the future.’

Ed Miliband, Leader of the Opposition


‘Stability and consistency are what businesses need to grow and prosper. This budget sets the tone, providing a clear plan for fiscal health and growth.’

John Cridland, Confederation of British Industry


‘Unless we address the UK's skills challenges, any short-term gains in the economy will be dashed by productivity shortfalls in the long-term.’

Mark Beatson, chief economist for the CIPD


Warning:

This Report was written immediately after the Chancellor delivered his Budget speech and is intended to be a general overview of the main announcements. It is based on the press releases and other documents available on 18th March 2015. Budget proposals are subject to amendment before the Finance Act receives Royal Assent. This summary is not intended as a complete summary of every measure. Every effort is made to ensure accuracy, but no liability is accepted for any action taken or refrained from in consequence of its contents. Always seek professional advice before acting.