In the news: A look ahead to next month’s post-Brexit Budget and your free Budget App
While Brexit may have been dominating the headlines, the Conservative government and Chancellor Sajid Javid will also be preparing to deliver the first post-Brexit Budget on March 11th. It’s set to be the UK’s first Budget in more than four decades as a non-EU state but what key areas of key finance should you be prepared for?
What to look out for – and what surprises could the government spring?
Tax cuts and thresholds
The election manifesto included a tax cut for more than 30 million workers in the form of an increase in the threshold for paying National Insurance – due to save workers earning more than £12,600 around £100 per year.
Currently, on earnings over £8,632, you must pay 12% NICs. If the Chancellor’s election promise is confirmed in the Budget, this tax will only be payable on earnings over £9,500.
Previous plans to overhaul stamp duty – raising the threshold for paying it from £125,000 to £500,000 at the same time as lowering the top rate from 12% to 7% – was dropped from the Tory manifesto but it’s worth keeping an eye on whether this could make a comeback in the Budget.
A promise was initially made in the Queen’s speech with regards to helping first time buyers by launching the First Home Scheme, resulting in local homeowners getting a 30pc discount on property. It’s claimed this will save first time buyers tens of thousands of pounds.
The topic of pensions is likely to centre on the tapered annual allowance. In their manifesto, the Conservative Party promised to launch an urgent review of the taper problem in doctors’ pensions.
The annual limit was in excess of £250,000 as recently as 2010/11, but it has been cut dramatically and now stands at just £40,000. For higher earners an additional ‘taper’ brings the allowance down further to just £10,000 for individuals with total earnings of £210,000 or more.
Senior clinicians in the NHS are facing huge tax bills if they and their employer pay into a pension above the tapered annual allowance. Workers have chosen to turn down work and overtime, rather than risking a retrospective pension tax charge.
There may also be announcements on topics such as social care, environmental policy and even IR35 – stricter tax rules for contractors that are set to be rolled out across the private sector from this year. But with a review of the extension taking place this month, could IR35 be delayed further?
How can accountants effectively communicate key Budget updates to clients?
The digital age is helping accountants to achieve transformational efficiencies and be proactive rather than reactive, all through App technology.
Instead of producing Budget cards that list the changes announced, which then need to be sent to clients, or pulling together email content to send to your client list, the digital age allows an instant turnaround that enables key changes to be communicated in almost real-time via your own App.
Your free Budget App
One of the features of OneApp, the leading App for Accountants in practice, is the Budget Pack and live notifications which allow you to communicate budget updates to your clients effortlessly. OneApp contains a library of Budget information which is kept up to date by our in-house content team so your clients can access it in your App at any time. On the day of the Budget our team send out push notifications straight to your clients’ Smartphone which contain key announcements and updates instantly as they happen. Best of all is you don’t need to do a thing – our team writes, collates and sends the information for you. This adds massive value to the service you provide your clients – as they are receiving real time, accurate, important information all via your own branded App.
You can download a free trial of our budget App in advance of next month’s budget here!