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

Capital Gains Tax Rate of tax and annual exemption The rate of CGT for disposals from 23 June 2010 onwards is determined by adding a taxpayer's chargeable gains to taxable income. If the gains then fall within the basic rate income tax band they are charged at 18%. If the higher rate threshold for income tax is exceeded, they are charged at 28%. These rates were not changed in the Budget, so they will apply for 2011/12. Mr Osborne has indicated that they are likely to remain at this level for several years. The annual exempt amount for CGT will increase to £10,600 (2010/11: £10,100). In future it is intended to be subject to automatic indexation in line with the Consumer Prices Index. Trustees Trustees continue to be liable to CGT at 28% after deducting half the normal annual exemption (£5,300 in 2011/12). The annual exemption is shared between trusts set up by the same settlor since June 1978, subject to a minimum of £1,060. Entrepreneurs' Relief (ER) Entrepreneurs' Relief allows certain disposals of businesses and business assets to be charged at a lower CGT rate of 10%. There is a lifetime limit of gains which can qualify. This was increased from £2m to £5m in Mr Osborne's first Budget for disposals from 23 June 2010 onwards, and will increase to £10m for disposals from 6 April 2011. A large gain would otherwise be taxed at 28%, so this represents a very substantial saving.