When news happens, text CHRON and your photos or videos to 80360. Or contact us by email & phone.
Nick Parker from leading accountancy and business advisory firm RSM Tenon, in Basingstoke, shares his views on the budget
NICK Parker, tax partner at accountancy and business advisory firm RSM Tenon, shares his views on George Osborne’s budget.
Nick who is also the managing director of RSM Tenon’s Basingstoke office, at Vantage, in Victoria Street, said: “The budget does nothing to encourage savers or redress the restrictions imposed on pension savings.
“The burden to support an ageing population remains a key long term challenge.
“The setting up of new disclosure facilities to include the Isle of Man and the Channel Islands affords non-compliant taxpayers further potential to disclose on a voluntary basis.
“The yield is expected to be £1billion over the next five years which is indicative of the scale of funds potentially at risk.
“It is conversely underwhelming to see that the new levies imposed on high value residential properties is only likely to yield £195 million over the next five years. It will be interesting to know how much it will cost to administer the scheme.
“The modifications on benefits to employees, particularly around share schemes, whilst interesting and innovative are unlikely to provide any real encouragement for the desired objectives. “The smallest of SMEs will welcome the £2,000 NI refund because it might just encourage the employment of an extra person. However whilst the propensity for it to create jobs will always be debatable, the measure will effectively inject £6bn into the economy.
“For the larger SMEs, Income tax it is too modest and a waste of time – we question whether it really compensates for giving up employment rights. The risk reward balance is not right.
“However a 20 per cent corporation tax rate from 2015 is a positive reaction to calls from the CBI to champion the UK as a platform entry point for investment into Europe.
“Perhaps the bravest measure announced is the proposal on helping home owners. Coupled with the reform of the planning system, the question is will it inspire the construction industry and associated businesses? This is the sizzle in the Chancellors speech to stimulate economic activity and inspire investment by the construction sector. Without the use of traditional tax stimulus.
“The proposed consultation on LLP structures could have wide ranging implications. We will await the consultation documentation with interest.
“The headline increase of personal allowance to £10,000 offset by a decrease of the basic rate band to £31,865 which looks like more will fall into higher rate earlier next year with a slight improvement in 2014-15.
“The impetus on tackling avoidance at grass roots level remains to include extension of naming and shaming to Tax Promoters, consultation on penalties imposed on those who fail to settle their liabilities following defeated schemes and even a consultation to better understand the motivation of individual’s to avoid tax.”