Express Accountancy
Budget 12th March 2008

• Overview - Small Company tax increased to 21% in 2008 and 22% in 2009. Basic rate of tax to be reduced to 20% in April 2008.
  
  
• Tax Returns - For the tax year ended 5th April 2008 all personal tax returns will have to be submitted by 31st October rather than the existing 31st January of the following year, this measure will have a significant impact on Accountants and their clients.
  
  
• Corporation Tax for Small Companies - RAISED TO 21% from April 2008 and to 22% from April 2009 (from 19% in 2006).
  
  
• Capital Allowances for Small Companies - Increased to 100% for up to £50,000 per year of expenditure from April 2008 .
  

• Personal Allowances - Personal Allowances increased to £5,435 (£105 per week). 10p rate of tax abolished. Basic Rate remains reduced to 20% from April 2008. Higher rates tax kicks in once total earnings reach £41,435.
  
  
• National Insurance - Thresholds upgraded in line with personal allowances. No change to rates this year.
  
  
• Capital Gains Tax - Threshold increased to £9,600. 18% of all gains over the threshold (taper relief abolished). Lifetime entrepreners relief of up to £1M for sale of business assets on which CGT restricted to 10%.
  
  
• Inheritance Tax - Threshold raised to £312,000.
  
  
• VAT Threshold & Rate - Vat registration threshold increased to £67,000 . No change to the rates of VAT announced.
  
  
• Stamp Duty - Starting Threshold still £125,000.
  
  
• Self Employed National Insurance - Class II National Insurance raised to £2.30 per week.
  
  
• Computers at Home - Computers provided by a business for home use will be subject to benefits in kind.
  
  
• Minimum Wage - Adult Rate raised to £5.52 from 1st October 2007.