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A quick guide to the 2012 Budget

At this time of year everyone is bombarded, or at least I am, with budget summaries. My very short version is below. If you would like further details, an in-depth budget summary appears at the end of this blog post.

Personal allowances. The personal allowance will be increased to £9,205 from 6 April 2013. The change will only benefit basic rate taxpayers.

The personal allowance changes to £8,105 from £7,475 on 6 April 2012.

The increased tax allowances for the over 65s to be phased out over a period as personal allowances increase.

VAT. The VAT registration threshold increases to £77,000 from 1 April 2012.

Further changes apply to the VAT treatment of self-storage, alterations to listed buildings, rental of salon chairs by hairdressers, static holiday caravans, certain hot take-away food and sports nutrition drinks.

Corporation Tax. No changes to the rate of Corporation Tax paid by small companies.

The rate paid by companies with profits over £1.5 million will reduce to 24% from 1 April 2012.

This will reduce further to 23% on 1 April 2013 and to 22% on 1 April 2014.

Capital allowances. The annual writing-down allowance is to reduce to 18% from 1 April 2012.

The annual investment allowance reduces to £20,000 from 1 April 2012.

100% Capital allowances for trading companies within designated investment zones investing in plant and machinery.

Capital Gains Tax. The annual Capital Gains Tax allowance increases to £11,200 from 6 April 2012.

No changes to Capital Gains Tax rates.

Company cars. Further increases in the fuel charge for company cars.

Beer. Duty up 3p a pint.

Cider. Duty up 2p a litre.

Wine. Duty up 11p a bottle.

Spirits. Duty up 41p a bottle.

Cigarettes. Duty up 37p a packet of 20; also increases for cigars and hand-rolling tobacco.

Stamp Duty Land tax. New rate of 15% on residential properties costing £2 million or more purchased by ‘non natural persons’ – interesting concept!

Further measures introduced to stop Stamp Duty avoidance planning.

Anti-Avoidance. Measures will be introduced but not yet.

If you would like a further in-depth analysis, a full budget summary is available to download.

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