Lambert Chapman LLP’s Lisa Potter reviews the 2009 Budget

 

GOOD, BAD and INDIFFERENT, to me this sums up the contents of the 2009 budget.    Given the current climate and the potential effect on their re-election, Darling was not expected to deliver a budget full of excitement and for this reason he did not disappoint.

 

Positive outcomes include the incentives for electric cars and the scrapping of cars over 10 years old, although the latter could be abused by those trying to earn some money if not closely regulated.   The ability to use furnished holiday letting losses from overseas property against other income in the UK is again a positive move, as currently many individuals are suffering losses as a consequence of less travel and the high cost of the Euro.      The continuation of the higher stamp duty level of £175k until the end of December 2009 is a stimulant to boost the housing market once again.    Also provides an opportunity to those with money to invest in property for their long term pension.

 

The bad news is that there were no real changes to help smaller businesses, I would have liked to have seen a radical change to the VAT threshold which again has risen by the mere £1,000, this is a limit that has never increased inflationary.    Also the removal of the higher rate relief on pension contributions for individuals earning over £150k – for a government that wants to encourage us to invest in personal pensions so they do not pick up the tab for it, how does this help?

 

Indifferent is the static status of the corporation tax rates and the changes to capital allowances, which whilst a positive step, in the current climate I do not feel will encourage additional spending in this area.     

 

The naming and shaming publicly of tax offenders, one thinks this is a ploy to encourage people to play the game properly, the reality is I feel this would have no benefit to either the revenue or taxpayers in general and will cost the government lots of money to ensure it is implemented correctly.

 

Let’s hope that as part of the new regime for attacking tax offenders whereby more detailed accounts are required for a period of 5 years after the offence they insist on using qualified accountants to prepare them!  

 

Overall another boring budget where Darling has not been daring.

 

 

  

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