The Budget In A Nutshell: An Overview From WWW.NIbusinessinfo.Co.Uk
How the Budget 2014 affects Northern Ireland businesses
The Chancellor of the Exchequer, George Osborne, delivered his Budget to Parliament on Wednesday 19 March 2014.
Changes already due from April 2014
* National Insurance Contributions (NICs):
* primary threshold for employees increases from £7,755 to £7,956
* upper earning limit will rise from £41,450 to £41,865
* new NICs employment allowance of £2,000 begins in April 2014 – read further details on the gov.uk website
* Corporation tax:
* currently at 23 per cent
* will be cut to 21 per cent from April 2014
* will be cut again to 20 per cent from April 2015
* Alcohol and tobacco duties will rise by 2 per cent more than inflation
* Pensions: the total amount you can contribute to your pension scheme with tax relief each year is being cut from £50,000 to £40,000
* the tax free lifetime allowance for the value of your pension pot is being cut from £1.5 million to £1.25 million
* 2.7% in 2014/15
* 2.3% in 2015/16
* 2.6% in 2016/17
* Government borrowing forecast.
* £95 billion in 2014/15
* £75 billion in 2015/16
* £44 billion in 2016/17
- Overhaul the UK Export Finance’s (UKEF) direct lending programme by doubling it to £3 billion and cutting the interest rate by a third.
- Find out about the UKEF support available on the gov.uk website.
- Step up marketing so that more businesses are aware of the UKEF’s products and services
- Air passenger duty (APD) bands C and D will be abolished from 1 April 2015 – this will mean that flights to South Asia and the Caribbean will pay tax at the lower band B rate.
- Help to Buy equity loan scheme will be extended until March 2020.
- Government to create a £500 million Builders Finance Fund which will provide loans to developers to unlock housing units stalled due to difficulty accessing finance.
Help for businesses
- New NICs employment allowance of £2,000 begins in April 2014.
- First enterprise zone in Northern Ireland to be established in Coleraine, which the government will support by offering enhanced capital allowances to investors within that zone.
- The annual investment allowance to be doubled to £500,000 until the end of 2015.
- The personal allowance will increase from £9,440 to £10,000 from April 2014 and will increase again to £10,500 from April 2015.
- Fuel duty rise planned for September 2014 has been cancelled.
- Beer duty will be cut by 1 penny from 24 March 2014.
- Duty on spirits will be frozen for 2014-15.
- Machine games duty – the government will create a new higher rate of machine games duty at 25 per cent for B2 machines (also known as fixed-odds betting terminals).
- Bingo duty will be reduced from 20 per cent to 10 per cent.
- Tobacco duty will increase by 2 per cent above the rate of inflation with changes to come into effect from 6pm on 19 March 2014. Annual duty increases of 2 per cent above the rate of inflation will continue until the end of the next parliament.
- A new single ISA (NISA) will be introduced, which will be a simpler product with equal limits for cash and stocks and shares. The annual investment limit for the new ISA will be £15,000 a year.
- The cap on investments in Premium Bonds will be lifted from £30,000 to £40,000 from 1 June 2014. It will then be lifted again to £50,000 in 2015-16.
- All tax restrictions on pensioners’ access to their pension pots to be removed, ending the requirement to buy an annuity. The taxable part of pension pot taken as cash on retirement to be charged at normal income tax rate, typically 20 per cent, down from 55 per cent.
- There will be an increase in total pension savings people can take as a lump sum to £30,000.
- The Tax-Free Childcare costs cap, against which parents can claim 20 per cent support, will be increased to £10,000 per year for each child. This will mean that eligible parents can now benefit from greater support, worth up to £2,000 per child each year from autumn 2015. Tax-Free Childcare will be rolled out to all eligible families with children under 12 within the first year of the scheme’s operation.
– See more at: http://www.nibusinessinfo.co.uk/budget
© Invest NI 2014.