Budget 2014 at a glance

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AccountingWEB.co.uk
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Highlights

Business taxation summary

Personal tax summary

Anti-avoidance and tax administration

Economy

Tax tables 

  • Tax tables - a handy summary of the rates for 2014-15

Commentary and reactions

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19th Mar 2014 15:29

middle earners

Will people please stop referring to those dragged into HR tax as "middle earners" : they are in the top 10%

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By nigel
19th Mar 2014 16:06

Middle earners

@oldersimon - the proposed 40% threshold will be £31,785 in 2015. In 2012-13 the national average male earnings were £28,912. I know the personal allowance comes off this, but he numbers just seem too close to me. Perhaps I should call them "only just over the HR threshold earners".

Rebecca Bennyworth reckons 1m more taxpayers will fall into the 40% tax bracket under this change. Surely they are not part of the top 10% are they, or has the government managed to get 1m more people into paying tax (while taking out Xm at the bottom end)?

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19th Mar 2014 16:14

0/10

Personal allowances up, changes to thresholds etcetera etcetera.

Yet again a Chancellor does absolutely nothing for those most in need, namely the pensioners, sick and disabled, who don’t even receive £10k a year so aren’t affected by tax.

Whilst I understand the policy of “making work pay” to get the idlers off benefits, there are a large number of people who are stuck on benefits through no fault of their own. These are often people who had good jobs, paid their taxes, and had the misfortune to become disabled or just too old to work.  It is disgraceful that these people are being forced deeper and deeper into poverty by successive governments.

My rating for this budget 0/10 as it lacked any compassion or decency, and before someone accuses me of being a Labour or Liberal supporter, I have always voted Conservative and could never vote for the other two, which now leaves me with a real problem in 2015.

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19th Mar 2014 16:41

...

most of the benefits you refer to are of course paid free of tax...and are paid for by people currently working (and I guess depending upon how you wish to calculate the 'benefits' you may come to a different figure...council tax/DLA/rent etc?).  Of course the benefits will no doubt rise linked to inflation in someway....something not many employees (certainly at the lower end of the scale) will have experienced....with some having to settle for pay cuts to keep their job.

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By BKD
19th Mar 2014 16:55

Same old, same old ...

In more ways than one

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19th Mar 2014 17:16

The boys in Eton

The boys of Eton will still be rich.   On personal note it is not going to make one difference to my life as when give they always take back in another.   I used to really care about budgets when I was younger but confess to having the same attitude as BKD

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By BKD
19th Mar 2014 17:21

I used to hate Budgets

They kept knocking Scooby Doo and Tom & Jerry off the TV.

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By Old Greying Accountant
20th Mar 2014 23:40

That must have been ...

BKD wrote:

They kept knocking Scooby Doo and Tom & Jerry off the TV.

... a curious incident, wasn't  anything to do with a fork was it?

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19th Mar 2014 17:35

Knocking Scooby Doo off is wrong.  Scooby is much more exciting then George Osbourne and perhaps Scooby and his pals could investigate the things their taking away in secret.  There is always something it will come out in the wood work. 

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19th Mar 2014 18:10

What's that Scooby?

There's a nasty man with a briefcase coming, you say? Run Shaggy!

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By BananaMan
20th Mar 2014 11:23

RRRaggyyyyy

Red Leader wrote:

There's a nasty man with a briefcase coming, you say? Run Shaggy!

 

I think you mean "Run RRaggggyyyy!"

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19th Mar 2014 18:36

justsotax

I’ve recently dealt with a perfect example.  A widow received basic state pension. This is then topped up to what is laughingly deemed enough to live on by Pension Credit.  Husband had a small works pension, which pays around £60/month, so DWP reduce Pension Credit by £60/month. Net result the widow sees zero benefit from having the pension.

 

The moral being that unless the provisions you make for old age are going to take you above the Pension Credit limit, there is no point in bothering.

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By Old Greying Accountant
20th Mar 2014 23:43

The moral is ...

Life in the old dog wrote:

I’ve recently dealt with a perfect example.  A widow received basic state pension. This is then topped up to what is laughingly deemed enough to live on by Pension Credit.  Husband had a small works pension, which pays around £60/month, so DWP reduce Pension Credit by £60/month. Net result the widow sees zero benefit from having the pension.

The moral being that unless the provisions you make for old age are going to take you above the Pension Credit limit, there is no point in bothering.

Eat, drink and be merry, every day may be your last, and if its not some other bugger can work their fingers to the bone to pay you pension credit!

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20th Mar 2014 09:02

I concede you

are quite right...maybe we should remove the pension credit then?

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New pensions rules wont work

I like the new pensions loophole.

Assuming you are of the right age, you can pay £40k in this year, get full tax relief at say 40%.

Next year, take 25% out as a lump sum

Take the balance at a tax rate of 40%

Effective tax rate 30%

Not really thought this through have they?

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By cbp99
20th Mar 2014 10:52

Is this new?

ireallyshouldknowthisbut wrote:

I like the new pensions loophole.

Assuming you are of the right age, you can pay £40k in this year, get full tax relief at say 40%.

Next year, take 25% out as a lump sum

Take the balance at a tax rate of 40%

Effective tax rate 30%

Not really thought this through have they?

The tax-free lump sum rules have always allowed pension to be taxed at an effective rate of 15/30%.

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.

Yes but it allows you to recycle ALL the cash through at your marginal rate. The only issue if going to be your earnings level.  If you are say 55 in a senior role on say £90k PA you could stick the full £40k through each year and have it back at 30%, saving £4k PA in income tax.  With the 55% rate this stopped this sort of thing being worthwhile.

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20th Mar 2014 11:33

Good budget

Very few gimmicks and giveaways, laying a solid foundation for the next five years when public finances should hopefully get back on track.

Compare it to the Labour party alternative: 'wish list' politics: freezing energy prices (companies will raise prices prior to the freeze date, hence pushing up prices earlier than would otherwise have happened) and various 'dangle goodies' promises with no real basis to stand on- like promising to find jobs for hundreds of thousands of people..we're still trying to reduce the number of civil servants from their last effort at employing everyone by the state and still paying for it too!

Very happy on the pension changes and will make me happier to send clients to an IFA who might recommend building up a pension pot.

 

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20th Mar 2014 13:32

the books have to balance

one mans pay rise is another mans pay cut

one mans tax cut is another mans burden

 

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20th Mar 2014 22:35

Pensions changes are good

As someone who has been savaged by Equitable Life and let down by Standard Life, who is now approaching retirement, how could I criticise this budget?  My pension pot would yield a derisory amount as an annuity.  Concerns have been raised about people blowing their pot straight away, but the difference between a big sum with a 40% tax hit or smaller more regular sums with a 20% tax hit is enough to ensure that pensioners will draw down their pension pots in  a careful manner.  This is the first budget that I have seen that benefits my age group and I can't see anyone else being penalised apart from the big pensions rip-off annuity providers.  If only they could invent a scheme that hit bankers just as hard!!

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By skhan
23rd Mar 2014 01:03

Rebecca Budget Report

When is it coming ?

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25th Mar 2014 11:50

Thanks

For this handy summary, it's nice to have all the key information in one place! 

Kind regards,

PK Group

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