Budget 2011

by admin on May 11th, 2011

Who can expect to be ‘better’ off following
George Osborne’s Budget speech?

First-time buyers
First time buyers are to receive aid from the Government to the value of £250m. Under a scheme called Firstbuy Direct, 10,000 individuals will be helped to get on the housing ladder, filling the gap in the market left by Labour’s Homebuy Direct initiative, which ended last year.

The new scheme will help individuals buy new build properties, which should also support the construction industry. First-time buyers will need to raise only 5% of the deposit themselves. The Government will provide 10% and the remaining 10% will come from the house-builder.

The Government aid, structured as a loan, will be available to households earning less than £60,000. The loans would be interest free for five years, with borrowers paying 1.75% interest the year after and then 1% above inflation.

Low and middle-income earners
The personal allowance, the amount that people can earn free of tax, is to rise by £630 to £8,105 – on top of the £1,000 increase announced in the Emergency Budget last summer.

The move is expected to benefit 25 million people and take 250,000 out of Income Tax altogether. Unlike the previous increase, effective April this year, it will benefit those paying higher rate 40% tax as well as those on lower incomes. But those earning more than £115,000 will not benefit from the increase.

Travellers
The Chancellor offered travellers a small financial incentive by freezing air passenger duty.

Investors
The level of Income Tax relief for Enterprise Investment Schemes (EISs) increased from 20% to 30% from 6th
April 2011.

The Government will also increase the size of a company that can qualify as an EIS and raise the limit that can be invested in a firm by 400%

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