Budget 2009

To see how this will affect you, check out the BBC’s handy calculator:-

http://news.bbc.co.uk/1/hi/business/8008685.stm

Budget 2009: Summary of key measures 

• The UK economy is forecasted to shrink by 3.5% in 2009. The growth forecast for 2010 is 1.25%, and from 2011 onwards it’s 3.5% a year.
• Inflation will reach 1% by the end of the year. The retail price index will drop by -3.5%.
• Public sector net borrowing is expected to hit £175bn this year (12.4% of GDP), and then £173bn, £140bn, £118bn and £97bn in the years that follow.
• UK net debt stands at 59%, rising to 68% next year and increasing again to 79% by 2013/14
• Income tax will not go up this year for most, however those earning more than £150,000 will see an increase from 45% to 50% from April 2010.
• Fuel duty will be upped by 2% from September, and 1% above indexation every year for the next four years.
• Alcohol and tobacco duties will be increased by 2% from 6pm today.
• Stamp duty holiday on homes under £175,000 will be extended until end of 2009.
• A new car scrapping scheme will offer a £2,000 discount on new cars when vehicles over ten years old are traded in.
• The child element of the Child Tax Credit will increase by £20 from April next year.
• Parents will receive £100 extra in child trust fund vouchers for new babies, taking them to £350.
• State redundancy pay is to rise from £350 to £380 a week.
• Grandparents’ care for young relatives will count towards basic state pension.
• Last year’s increase in winter fuel allowance to be extended for another year.
• Annual ISA limit to be increased from £7,200 to £10,200, half of which can be invested in cash. From this year for over-50s, from next year for others.
• Loss-making companies can reclaim tax paid on profits made in past three years.
• Additional £1.7bn funding for jobseekers.
• From January 2010 everyone aged under 25 unemployed for a year to get offer of job placement or training.
• £260m new money for training and subsidies.
• £250m extra this year to enable 16- to 17-year-olds to stay in education. £400m in next two years.
• Pension tax relief restricted for those on incomes over £150,000 from April 2011. It will be gradually tapered to the same 20% rate received by most people.
• £500m extra support for housing industry.
• £100m for local authorities to build energy-efficient housing.
• £50m to accelerate modernisation of housing for military families.
• Main capital allowance rate doubled to 40% to encourage firms to bring forward investment.
• £750m investment fund to provide financial support to emerging technologies.
• Carbon budget commits UK to reduce emissions by 34% by 2020.
• £435m extra support for energy efficiency measures for homes, businesses and public places.
• £525m new support for offshore wind power projects. Will provide enough electricity for 3.5m households.
• £405m new funding for low-carbon technology projects.
• Most energy-efficient new power stations using combined heat and power to be exempt from climate change levy.

(From accountingweb.co.uk)