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Business News - May 2009
The New Pension Regime
In his Budget, the Chancellor announced two changes to tax relief on pension contributions for individuals with income above a certain level.
Personal Tax Changes
The Chancellor has not only brought forward proposals which were to take place in 2011, he has also made changes to his original announcements.
Restricted Tax Relief on Pension Contributions
Pension contributions made by an individual are usually paid net of basic rate tax. Where the individual is a higher rate taxpayer further relief is due which significantly reduces the net cost of the contribution.
Enhanced Relief for Trading Losses
Under current rules businesses already have a number of mechanisms to relieve trading losses against other income including past trading profits.
Capital Allowances on Plant and Machinery
Additional capital allowances are to be available for expenditure incurred by a business in the 12 month period (starting 1 April 2009 for companies and 6 April 2009 for individuals and partnerships).
Standard Rate VAT
The standard rate of VAT was reduced from 17.5% to 15% for the 13 month period 1 December 2008 to 31 December 2009. HMRC have confirmed that the standard rate of VAT will revert to 17.5% from 1 January 2010.
VAT System for Cross-Border Trading
A package of measures is being introduced to simplify and modernise the VAT system for cross-border trading and to counter fraud across the EU.
Bradford & Bingley Position of Former Shareholders
As you are no doubt aware, shares in Bradford & Bingley plc were taken into public ownership last year. HMRC have issued guidance relevant to former shareholders and employees who were members of employee share schemes.
Change of HMRC Bank Account Details
HMRC bank account details for paying self employed Class 2 and voluntary Class 3 National Insurance Contributions have changed. HMRC have advised that individuals will need to use the new account details when making a payment.
Businesses Given More Time to Pay Business Rates
Alistair Darling made a late change to the impact of business rate rises which were due to take effect in England from 1 April 2009.
