Budget 2014 - Summary for Contractors

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On the whole, the 2014 budget can be viewed positively by the majority of Britain’s contractors. Chancellor George Osborne referred to it as “a budget for the makers, the doers and the savers” and let’s face it, it’s about time we had one of those! Let’s hope that the “Pay-up first” avoidance rule will punish those for whom it is really intended and the innocent casualties are few. For more information please visit - http://www.freestyleaccounting.com/blog/budget-2014-summary-for-contractors/

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Budget 2014 Summary for Contractors:

Budget 2014 Summary for Contractors www.freestyleaccounting.com

The Good News:

The Good News Contractors, undertaking "normal transactions" have been given no new measures to contend with no new measures to strengthen IR35 the small companies profits’ rate will remain at 20% in 2015 the VAT registration threshold will rise (as it usually does in April) to £81,000

The Good News:

The Good News Also, the government will invest another £6billion into the Help to Buy initiative The scheme will now run until 2020 The additional £6billion will be used in the equity loan part of the Help to Buy scheme

The “Not so good” news (but only for a limited few...):

The “Not so good” news (but only for a limited few...) The “ pay-up first ” tax avoidance rule (mentioned in the Autumn 2013 statement) is going ahead This means Contractors who are already under investigation or in receipt of a notice of assessment from HMRC, or who have used a tax avoidance scheme that is registered, or countered by the GAAR for tax avoidance, will be forced to pay the amount of disputed tax before the case is resolved and without exception

What happened to “Innocent until proven guilty”?:

What happened to “ Innocent until proven guilty ”? Those who are victims of HMRC errors and arguably those contractors who have used legal tax avoidance mechanisms in good faith, and followed HMRC guidance by notifying the department that they used them under DOTAS (Disclosure of Tax Avoidance Schemes), may feel that HMRC are moving the goalposts retrospectively

And as if that wasn’t bad enough...:

And as if that wasn ’ t bad enough ... New recovery powers for HMRC mean that they can recover disputed tax amounts from the investments held by the contractor owing more than £1000 A minimum aggregate balance of £ 5000 must be left across all accounts but other than that, HMRC can take what they need in order to satisfy the debt This includes those on low incomes who have fallen behind with their tax payments and those using the DOTAS regime

In Summary:

In Summary On the whole, the 2014 budget can be viewed positively by the majority of Britain ’ s contractors Chancellor George Osborne referred to it as “ a budget for the makers, the doers and the savers ” Let ’ s hope that the “ Pay-up first ” avoidance rule will punish those for whom it is really intended and the innocent casualties are few

PowerPoint Presentation:

For more information on how the 2014 budget might affect you, please visit Freestyle Accounting

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