The pre-Budget report happened yesterday, don’t know if you heard. As usual, it was seen as something of a mixed bag for small businesses; the Tories and the big accountancy firms said it smacked of ‘buy now, pay later’, but small business groups said it provided some welcome short-term relief.
The big headlines were a £7bn pot of tax cuts and loan promises for small businesses, coupled with a nasty 0.5 per cent increase in NIC which affects both employees and employers and will net HMRC £5bn a year – that starts in 2011.
Also unpopular will be the increase to 45% of income tax for people earning more than £150,000 a year. That affects not only wealthy people in Britian, but also could act as a deterrent to highly skilled workers from abroad who are considering coming to work in the UK.
Other changes include a postponement of the planned increase in small business coporation tax, spreading tax payments for small businesses struggling with cash-flow, extended loss relief allowing small firms to carry back losses for three years and a gradual reduction in personal allowances for high-earners.
A mixed bag indeed, but how will it affect you?
