The emergency budget 2010

The main highlights from the emergency budget 2010 are as follows:


*Main corporation tax rate (currently 28%) will be cut by 1% each year for the next four years, effective from 1st April 2011.
*Small profits rate reduced by 1% to 20%, effective from 1st April 2011.
*Annual investment allowance (capital expenditure that can offset against profits in the year of spend) reduced from £100,000 to £25,000, effective from April 2012.
*Employers’ national insurance increased to 13.8%, effective from 6th April 2011
*Employers’ NIC exemption of up to £5,000 for the first 10 employees in a company’s first year of trading providing that they are based outside London, the South East and Eastern England.

Personal tax

*Personal allowance (£6,475) will be increased to £7,475 effective from 6th April 2011.

Capital Gains Tax

*Rate increased from 18% to 28% for high rate tax payers, from 23rd June 2010.
*Entrepreneurs’ relief lifetime limit (for business asset disposals) increased from £2m to £5m, from 23rd June 2010.


*Standard rate of VAT will increase from 17.5% to 20%, effective from 4th January 2010.