Press Releases

06 April 2011

Wilkins Kennedy hosts budget seminar for Surrey businesses

On Friday 25th March 2011, UK top 25 chartered accountancy firm Wilkins Kennedy Chartered Accountants and Business Advisers held a budget breakfast briefing at Foxhills Surrey.

Over fifty attendees heard Wilkins Kennedy Egham Tax Partner and the firm’s Head of Taxation Services, Matthew Hall, introduce four of the Egham Tax Team who explored the Budget and identified tax planning opportunities.

Wilkins Kennedy partners Matthew Hall and Roger Williams were joined by Jeremy Newman, Jemima Jones and Susan Osborne, who gave presentations on different aspects of the budget. The presenters were available to address questions and expand on points of interest, and all businesses attending obtained a hard copy of the WK budget report.

Kevin Walmsley, Managing Partner of the Wilkins Kennedy Egham and Heathrow Office, commented: “The budget briefing was an opportunity to give an early assessment of the budget and to explore tax planning opportunities whilst also addressing the questions and concerns of the local business community post the budget announcements.”

Details discussed on the day:

Income Tax

At the start of the new tax year the basic personal allowance for those aged under 65 will increase to £7,475 and the basic rate limit will be reduced from £37,400 to £35,000; the effect being that higher rate taxpayers will not benefit from the increased personal allowance.  Pension contributions and gift aid donations can be made to ensure that income remains within the basic rate band and higher rate tax is avoided.
 
The 50% rate of tax remains, for now at least, as does the loss of personal allowance once income exceeds £100,000.  As Income between this and £114,950 is effectively taxed at 60%, pension contributions and gift aid donations should again be made to mitigate the amount of income taxable at this high rate.

National Insurance

The rates of both employees’ and employers’ national insurance will increase by 1% across the board and class 2 contributions will increase by 10p, to £2.50 per week.  All increases will take effect on 6 April 2011.

ISAs

Junior ISAs, a new form of tax-free savings account for children have been announced and are expected to be available in the autumn of 2011.  All UK residents under 18 who do not already have a Child Trust Fund will be eligible to open a Junior ISA.

Entrepreneurs

For anyone looking to sell their business the Capital Gains Tax liability will be lower than expected where the business is being sold for more than £5 million resulting in lifetime qualifying gains of up to £10 million being taxed at just 10%.
Inheritance Tax

The budget did not announce any major changes; however careful inheritance tax planning remains vital.  Up to date, effective wills should be in place and where appropriate, the use of family trusts and gifts out of income should be exploited to mitigate potential liabilities.  Tax efficient investments, such as a subscription in Enterprise Investment Scheme shares, can significantly reduce an estate’s exposure to inheritance tax on death.

Capital Allowances

Businesses with high capital expenditure such as farming and manufacturing businesses will continue to benefit for another year from full tax relief on expenditure up to £100,000 but this will be dramatically reduced to £25,000 from April 2012. Therefore, businesses that are looking to invest in capital projects should do so before April 2012.
Furnished Holiday Lettings

Losses of a Furnished Holiday Letting business will no longer be available to offset against any other income.  Going forward, losses may only be relieved against future profits from the same letting business.
 
Furthermore, from April 2012 the minimum period over which a qualifying property must be available for letting and is actually let to the public will increase to 210 days and 105 days respectively. Therefore it may be necessary to reduce any private use of a qualifying property and increase advertising to ensure the new conditions are met.
 
Despite the changes, Furnished Holiday Lets do continue to benefit from favourable tax treatment and remain an attractive property investment.
 

For further information please contact:

Laura Hazell
Oxwich Communications Ltd
Public Relations Agency
Tel: 0845 226 7469
Email: laura@oxwichcommunications.com

Or

Lyn Carlier
Wilkins Kennedy – Egham
Tel: 01784 435561
E: lyn.carlier@wilkinskennedy.com

Notes to Editors:

Wilkins Kennedy was established in 1882 and has grown to become one of the UK’s top 22 firms of Chartered Accountants and Business Advisers with a turnover of almost £30 million.

The firm has 53 partners and almost 400 staff in twelve offices across the South of England.