This year’s Budget has shown how the Chancellor George Osborne wants to revitalise the economy by committing billions of pounds to infrastructure projects, house building and introducing a series of tax breaks for businesses.

This publication provides you with the highlights of the Budget but also the likely impact it will have on your clients' businesses.



The standard rate of Corporate tax will be lowered to 20% from April 2015.

In 2015, this change will mean businesses will retain more of their profits, allowing them to invest more and create jobs. All companies will pay a standard rate of corporate tax from April 2015.

The Bank levy rate to increase to 0.142% in 2014.

As the levy directly impacts on the Bank's margins this cost is likely to be passed on to their customers through increased borrowing costs and lower deposit rates.

New Employment Allowance will take the first £2,000 off the Employer National Insurance bill of every company in the country from 2014.

Around 450,000 small businesses - one third of all employers - will pay no employer National Insurance at all.

This will encourage small firms to appoint more staff to support their business growth plans.


Businesses will be able to employ a member of staff on £22,400 without paying any Employers’ NIC at all.


Tax related matters to discuss with your clients

  • Structuring the business in the right way is critical to ensure both corporate and shareholder agendas are adequately dealt with. The new focus on LLP structures and consultations on anti-avoidance being announced shortly means that SME clients should be reviewing their structures.  
  • Business Rates were not discussed in this year’s Budget, therefore next month all businesses will feel the brunt of a rise in business rates which increased by 13 per cent in the last three years. As business overheads continue to increase it is important that your client regularly reviews its cost base to identify areas where savings can be made.
  • With the new limitation on Inheritance Tax relief on debts, it may be an appropriate time to discuss tax planning with your clients.
  • Ensure that your clients are aware of the new rules relating to Real Time Information, and in particular, the relaxations recently announced for businesses of 50 or fewer employees.
  • Individuals and businesses should be planning this year for the changes to tax relief on pensions and the reduction in lifetime allowance from April 2014. This will include considering the level of contributions made in 2013-14.
  • The squeeze on avoidance continues therefore it remains extremely important that you discuss the risks involved with such schemes.

If you have any questions on the above highlights, please e-mail [email protected] or [email protected] and a member of our team will contact you.

Source: Paul Belsman, Head of Tax, UK member firm RSM Tenon.