Welcome to the 2009 Budget Newsletter from Connolly Accountants Ltd

Chancellor Alistair Darling has unveiled a series of measures aimed at tackling the 'unprecedented economic crisis'.

As widely anticipated, growth forecasts for 2009 have been revised down, with the economy expected to shrink by 3.5%; while borrowing forecasts have risen sharply to £175bn. However, despite the economic gloom, the Chancellor asserted that the economy will recover, forecasting growth of 1.25% next year.

Key announcements include the introduction of a 50% income tax rate for those earning more than £150,000 a year, from April 2010.

The stamp duty land tax 'holiday' for residential properties valued at £175,000 or less will be extended to the end of 2009.

Measures for businesses include the introduction of a temporary 40% first year allowance, an extension of help for loss-making companies, and a top-up trade credit insurance scheme.

The Chancellor allocated £1bn to tackle climate change, and announced a commitment to cut UK carbon emissions by 34% by 2020.

The introduction of a 'car scrappage' scheme was also confirmed, offering £2,000 to people who trade in cars that are over 10 years old. Meanwhile, fuel duty will rise by 2p a litre from September 2009.

Other measures include an increase in the child element of Child Tax Credit from April 2010; credits towards the basic state pension for grandparents of working age who care for their grandchildren; and a rise in the annual limit for ISAs to £10,200.

For a detailed overview of the Budget Report and what it means for you and your business, visit our Report summary by clicking here.


WHAT THEY SAID

'Today's Budget will continue to help people through this global recession, and prepare Britain for the opportunities of the future'
Chancellor Alistair Darling

'The last Labour Government gave us the winter of discontent, this Labour Government has given us the decade of debt'
David Cameron, Conservative Leader

'A mish mash of recycled announcements from a Government skilled in raising false hopes and incompetent at delivering real hope'
Nick Clegg, Liberal Democrat Leader

'In what has been the most crucial Budget in decades, the FSB is disappointed that small businesses have been largely ignored'
John Wright, Federation of Small Businesses

'The Government appears to have understood that it will be business driving the economy out of recession, and there are some good measures that reflect this'
David Frost, British Chambers of Commerce

'Whilst today's Budget does reduce the rate of growth of public spending the scale of the fiscal deterioration in the UK means that extraordinary measures are required'
Miles Templeman, Institute of Directors


FOR THE FULL BUDGET ANNOUNCEMENTS VISIT:

http://www.hm-treasury.gov.uk/bud_bud09_index.htm


ON OUR WEBSITE

Essential business advice
For advice and information on all aspects of running a business, visit the 'Your Business' section of our website.

Tax and investment advice at the click of a button
For information on a range of personal taxation and investment issues, visit the 'Your Money' section of our website.

2009 Budget: the business reaction
Business leaders have given mixed reactions to the announcements made by Chancellor Alistair Darling in his 2009 Budget.
Click here for the full story

2009 Budget: the political reaction
Opposition leaders have given their reactions to the 2009 Budget announcements, following Chancellor Alistair Darling's speech to the House of Commons.
Click here for the full story

2009 Budget: Darling downgrades economic forecasts
Chancellor Alistair Darling has downgraded his economic growth forecasts for 2009/10 due to the 'unexpected severity of the recession'.
Click here for the full story