Budget 2016: Will the devil be in the detail?

By Anita Jaynes on 17 March, 2016

The view of the partners at Haines Watts Swindon on Budget 2016.

As the buzz around the Chancellor’s Budget statement grows, the partners at chartered accountancy firm Haines Watts, share their thoughts.

Mike Lloyd, managing partner, said: “On the global economy we got risk warnings. On the UK economy, promises of growth in Gross Domestic Product and reduction and elimination of the deficit.

“This all hinges, according to the Chancellor, on staying in the EU. It seems to me this is quite a high risk strategy of almost hijacking his own Budget speech.”

Mike welcomed changes in Capital Gains Tax, Corporation Tax, commercial stamp duty and investment – especially an increase in the higher rate threshold from 2017.

His comments chime with tax partner Martin Gurney who is warning business owners, company directors and shareholders that ‘the devil is in the detail’ yet again.

Martin said: “We will not truly know what the Budget tax measures are until we have the legislation.

“For me the headline grabbers are:

•   an 8% reduction in the rate of Capital Gains Tax effective from 6 April 2016

•   tax measures targeting larger companies with overseas subsidiaries and overseas retailers selling into the UK

•   a pension alternative – a new savers’ ISA enabling the under 40s to save up to £4,000 a year with the government adding a further 25%.

Martin believes while this is all seems positive, the detail means these measures may not be straightforward. For example the reduction in Capital Gains Tax could be seen as a chink of light for residential property landlords – who suffered under previous Budget announcements.   However, residential property is specifically excluded.

Sue Plumb, charity and not-for-profit expert focused her attention on schools and education. As expected the Chancellor announced plans for all state schools to become academies by 2020.

“Currently around 60 per cent of secondary schools are academies whilst the proportion of primary schools is much less at around 15 per cent – so this will have a significant impact on the education sector,” she said.

Other plans included enabling pupils to study maths until 18 and finding an extra £500m to achieve a ‘fairer funding formula’ to each school to address imbalance in the current system. This will be of particular interest for schools in Swindon and wider Wiltshire.

Haines Watts Swindon is a firm of qualified Chartered Accountants and business advisors based in Old Town. They offer a variety of accountancy and tax planning services to owner-managed businesses, charities and not-for-profit organisations  across the south west. The firm is part of the national Haines Watts network of offices. For further details visit www.haineswatts-swindon.co.uk

Pictured above from left to right: Mike Lloyd, Sue Plumb and Martin Gurney of Haines Watts, Swindon