Budget Summary 2011 Introduction Income Tax Tax Credits and Benefits National Insurance Employees Savings and Investment Capital Gains Tax Inheritance Tax Corporation Tax Business Tax Value Added Tax Stamp Duty Land Tax Other Measures Income Tax Rates and Allowances National Insurance Contributions

Savings and Investment Pension contributions (Table B) Significant changes to the rules on pension schemes were announced in advance of the Budget, but no further amendments were brought in on Budget day. The main changes coming in on 6 April 2011 are: Maximum tax-efficient pension contribution becomes £50,000 (or current earnings if less). Tax relief on personal contributions will normally be given by paying net of basic rate tax, with relief at the taxpayer's marginal rate through self-assessment or PAYE code. Employee contributions will normally be deducted from gross pay, and employer contributions are not included as taxable remuneration, subject to the same limits. If contributions have been below £50,000 in the previous 3 years, the unused limits can be used to increase the current contribution. The "anti-forestalling charge", which has applied to some extra contributions above £20,000 by people earning over £130,000 for the past 2 years, will no longer apply. It will no longer be necessary to purchase an annuity at age 75. More flexible "income drawdown" rules will allow greater control over an individual's pension fund during lifetime and on death. Tax Tip Take advice on new flexible rules for taking benefits. Enterprise Investment Scheme (EIS) Income tax relief for shares subscribed using the Enterprise Investment Scheme will increase from 20% to 30% with effect from 6 April 2011, provided EU State Aid approval is given. Further changes to the EIS and the Venture Capital Trust scheme will be introduced with effect from 6 April 2012, increasing the amounts that can be invested and the size of companies that can be invested in. Individual Savings Accounts (ISAs) The annual limit on investment in tax-free ISAs increases by £480 to £10,680 for 2011/12. This limit will increase in future in line with the Consumer Prices Index each year. Furnished Holiday Letting (FHL) Changes to the FHL rules come into force on 6 April 2011 in line with earlier announcements. In 2011/12 losses from a FHL business can only be set against FHL income rather than against the landlord's total income. In 2012/13 there will be increases in the qualifying periods of availability and letting for determination of what qualifies as a FHL.