There was much that was familiar about George Osborne's fourth Budget. Many of his announcements had already been revealed in his Autumn Statement in December.
The Chancellor did nevertheless manage to produce some surprises despite the economic constraints. With the 2013 growth forecast halved to just 0.6%, the tax give-aways, such as they were, were balanced by either extra revenue or reduced spending.
The move to a £10,000 personal allowance (from 2014/15) and a single corporation tax rate of 20% (from 2015) were hardly unexpected but were welcome. The new £2,000 employment Allowance from 2014 (which will be of most value to small businesses) was not foreseen, but was also welcome. It will be financed by the extra income from NICs that the single-tier pension will bring in from 2016/17 – a year earlier than previously planned.
Key highlights from the 2013 Budget...
- Personal allowance increased to £10,000 in 2014/15 and the higher rate threshold increased by £415 to £41,865.
- A new tax-free childcare scheme, phased in from autumn 2015, to provide 20% of childcare costs up to £6,000 per child per year, for children under age 12.
- The new single-tier state pension to be introduced from April 2016.
- A £2,000 employment Allowance for businesses and charities to set against their employer national insurance contributions from April 2014.
- A single rate of corporation tax of 20% for companies from April 2015.
View our complimentary 2013 Budget Report (PDF), which covers all the main taxation changes and issues, and includes a useful ‘Financial Calendar’ highlighting the important dates to remember to help you with your tax planning.