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We have highlighted key changes below. For more details click here For tables of rates and allowances for 2004/05 and 2003/04 click here For tables of rates and allowances for 2005/06 and 2004/05 click here KEY CHANGES
COMPANIES / EMPLOYERS This has been a low key budget with only a few announcements relevant to small companies and the most interesting point was the announcement that a consultation towards simplifying the tax affairs of small businesses will be carried out. The consultation is being carried out by the head of the newly merged Customs and Excise and Inland Revenue and proposals include a combined tax return, a single tax payment structure and integrated tax and VAT checks. We look forward to seeing how complicated the tax return is!
INDIVIDUALS
WATCH THIS SPACE
COMPANIES / EMPLOYERS National insurance No increase in the rates of national insurance have been announced but the earnings levels have increased slightly. Corporation tax rates No changes in corporation tax rates have been announced. VAT VAT fuel scale charges to be aligned with the company car benefit charge to provide consistent incentives for less polluting cars.
INDIVIDUALS Income tax The starting rate, basic rate and higher rate are unchanged on the previous year. Personal allowances The tax free allowance for all individuals has increased slightly. Employer provided vans At present there is a benefit on employees, who take their vans home, of £500 and no fuel benefit even if private mileage is paid for by the employer. The government is intending to reform these rules and it is expected that in future years the benefit will be based on emissions, as with company cars. A consultation document will be issued in due course. Child Tax Credit There is an increase of £65 in child element of Child Tax Credit from April 2005 Child Trust Fund This becomes fully operational in April 2005 with consultation taking place on further payments at age 7
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