Today George Osborne released the budget for 2015 and announced ‘the rich will pay the most’. He stated that £30bn worth of savings must be found, however insisted that the UK economy was improving and that “the sun is shining on Britain”. Here we look at the main points of the budget likely to affect businesses and employees.
- Corporation tax will be cut to 20% in 2 weeks time, releasing pressure on organisations.
- By 2017, tax free allowance will be increased to £11,000. This will be on done gradually; next year it will be increased to £10,800 before the final increase in 2017.
- The higher-rate tax threshold is also expected to rise above inflation by 2017, to £43,300.
- A new ‘diverted profits’ tax will be introduced, to ensure multinational organisations are handling their profits properly.
- Minimum wage will rise by 20p an hour to £6.70, and by the end of the decade is expected to rise to £8.
- Employers’ National Insurance contributions will be abolished for employees under the age of 21 by April. By April 2016 this will also apply to apprentices.
- Annual tax returns to be done digitally with ‘digital tax accounts’, so self-employed people can manage their affairs online, even using their mobile phones or ipads, keeping up with modern technology.
- In the next parliament, Class 2 National Insurance contributions for self employed people will be entirely abolished.
Mr. Osborne has also claimed that full-time employment is being created throughout UK including places like Yorkshire and other areas of unemployment.
For a full breakdown of the 2015 budget, please click here.