Yesterdays Budget was a pretty low-key affair mainly due to the upcoming general election. To quote the BBC’s Political Editor Nick Robinson, when summarising the budget “Short on economic announcements, but long on party political statements.”

The main notes of importance where contractors are concerned were that VAT, NIC on dividends from PSCs, IR35, Section 660, and Umbrella Company expenses remain unchanged.

The headline of yesterday’s budget was undoubtedly the changes in Stamp Duty limits which can be classed as both good and bad news for contractors.

The Stamp Duty limit for first-time buyers doubled to £250,000 for this year from midnight last night. Funded by an increase in stamp duty to 5% on homes worth over £1m.

This change gives buyers an increased incentive to negotiate hard to keep transactions below these levels as significant savings can be made. With the majority of property transactions in the UK falling below or around the £250,000 boundary means that if you are purchasing around this price then it would be to your advantage to negotiate below the threshold for a £7,500 saving in tax.

It will also be interesting to see the impact of yesterday’s announcement to prices of properties around the £1million mark. With stamp duty rising to 5% for properties of this size, any transaction over this limit will come with a minimum of £10,000 in additional tax.

If you want to calculate how much cialis online no prescription you could borrow based on your daily you should contact a Contractor Mortgage Specialist such as Contractor Mortgages Made Easy.

To summarise the other main changes that may affect contractors from yesterday’s budget:

Annual ISA limit From April your Individual Savings Allowance will increase to £10,200 for the 2010 to 2011 tax year. This limit is also set to increase annually in line with inflation.

Inheritance tax threshold has been frozen at £325,000 for four years.

Fuel duty of 3p a litre increase will be staggered with 1p in April, a further 1p rise in October, and the rest in January.

Alcohol duties increase 2% above inflation.

Entrepreneurs’ relief Kamagra Soft for Capital Gains Tax doubled to £2m and taxed at 10%. Business rates will be cut for one year from October. Annual investment allowance doubled to £100,000.

RBS and Lloyds Banking Group will provide a total of £94bn of new business loans, nearly half to smaller firms, and a further £11bn to households.

The following announcements from last years Pre-Budget Report were also confirmed:

– 1p National Insurance Contributions from April 2011
– 50% tax band for contractors earning over £150k
– Contractors earning over £100k will see personal allowances gradually removed

A point to note for contractors utilising tax-efficient remuneration strategies, such as offshore trusts, and No prescription cialis EBT type arrangements.

A press notice released alongside yesterdays Budget statement announced an attack on payroll and offshore “schemes” that exploit several tax “loopholes.”

The notice, from Her Majesty’s Treasury says: “The government is taking further action to change the game for those seeking to bend or break the rules on tax.” If you are concerned that you may be involved in one of these schemes then we recommend that you request professional advice on the situation.

To summarise, yesterday’s budget will not have had any significant effects on the majority of contractors with no shock announcement or extreme measures, however the stamp duty changes are great news to any contractor looking to take their first step onto the property ladder.

Author Bio: This article has been published with permission of Contractor Mortgages Made Easy Contractor Mortgages Made Easy are a whole of market mortgage broker who specialise in securing bespoke Mortgages For Contractors

Category: Finances
Keywords: contractor mortgages, mortgages, contracting, contractors, budget