The Government is increasing the child element for those families with children aged one or two from April 2012 by £4 per week.
From April 2010 awards for fixed period childcare costs (such as claims of a few weeks during the school holidays) will be averaged and paid over that fixed period rather than averaged over a year. This will enable families to receive all the financial support towards their childcare costs they are entitled to receive for these periods when they need it.
A new online service providing information on the range of financial support available has been launched on Budget Day. This information has been brought together in a single leaflet. It is aimed at front line staff and advisors outside Government to alert customers to relevant services.
HM Revenue & Customs (HMRC) is developing options for an online service for those who claim Child Benefit. As a first step it is establishing an electronic link with the General Register Offices who are responsible for registering UK births. This will mean that UK families who claim each year will no longer have to submit original birth certificates from 2011-12 as these will be verified electronically.
From 6 April 2011, people aged 60 and over will qualify for Working Tax Credits if they work at least 16 hours a week. Currently those aged 60 and over qualify for Working Tax Credits if:
The Government will improve access to the Working Tax Credit disability element for those who have been claiming the Employment and Support Allowance (ESA). From 6 April 2011, ESA customers who have a limited capability for work and leave ESA to move into work for at least 16 hours a week with the help of Working Tax Credit, will automatically pass the disadvantage test and qualify for the disability element. HMRC will consult with customer representatives on the details.
The Government will also consider whether to review the criteria used in the disadvantage test of the Working Tax Credit in the longer term.
As announced in the 2009 Pre-Budget Report (PBR) and confirmed in the Budget on 24 March 2010, from 6 April 2010:
From 12 April 2010 Child Benefit rates and Guardians Allowance will increase by 1.5 per cent.
Budget 2010 confirms the Pre-Budget Report 2009 announcement of the Income Tax rates and Personal Allowances for 2010-11:
From 2010-11 the additional rate will apply to taxable income above £150,000.
From 2010-11 the amount of the Personal Allowance will be gradually withdrawn for all individuals (regardless of age) with adjusted net incomes above £100,000. The rate of reduction is £1 for every £2 above the income limit.
The following amounts announced in the PBR 2009 have been confirmed in the Budget 2010. For 2010-11, with just two exceptions, all National Insurance contributions rates and thresholds are unchanged from the current year 2009-10. The two exceptions are:
For 2011-12, in addition to the 0.5 per cent increases already announced in PBR 2008:
The Government announced in Budget 2009 its intention to restrict tax relief on pensions savings with effect from 6 April 2011 for high income individuals. The measure will recover tax relief above the basic rate on pension contributions made by or on behalf of individuals with a high income.
For people with an income of £150,000 or over but below £180,000, tax relief on pension contributions (including the value of employer contributions for those in employment) will reduce gradually from marginal rate to basic rate as the income increases. Where an income is £180,000 or over, tax relief on pension contributions will be restricted to basic rate.
A consultation document, 'Implementing the restriction of pensions tax relief', including a consultation stage impact assessment, on the implementation of the restriction of Pensions Tax Relief was published in the 2009 PBR. In the Budget the Government published a final impact assessment and a summary of consultation responses.
The Registered Pensions Scheme 2010-11 Lifetime Allowance of £1.8 million and Annual Allowance of £255,000 will continue to apply at these levels for a further five tax years, ie up to and including the tax year 2015-16.
In Budget 2009, the Chancellor announced that the Furnished Holiday Lettings (FHL) rules would be withdrawn from 6 April 2010, (or from 1 April 2010 for companies). The legislation for this is in Finance Bill 2010. This will mean the tax treatment of FHL will be the same as for other property rental businesses.
The 2009 PBR announced that the Inheritance Tax nil rate band will be frozen at its current level of £325,000 for tax year 2010-11. Budget 2010 announced that the threshold will now be frozen at the same level until tax year 2014-15 (inclusive).
This proposal introduces the new CO2 grams per kilometre (g/km) emissions limits which set the appropriate percentage for computing Company Car Tax benefit. These support the Government’s commitments on reducing greenhouse gas emissions. The current graduated table of Company Car Tax bands will be extended down to a new 10 per cent band, and all CO2 emissions thresholds will be moved down by 5 g/km on 6 April 2012 so that the 10 per cent band will apply to company cars with CO2 emissions up to 99 g/km.
This measure introduces two changes effective for five years from 6 April 2010 to 5 April 2015 to the chargeable benefit in kind on company cars and vans:
A relaxation will be made to the conditions applicable to childcare voucher and directly contracted childcare schemes delivered through salary sacrifice arrangements, for those employees at or near the national minimum wage.
The Government intends to introduce a new Income Tax exemption for certain payments to special guardians, and to certain carers looking after children under a Residence Order. The changes will be effective on and after 6 April 2010.
The Government intends to introduce a new Income Tax exemption for certain payments to special guardians, and to certain carers looking after children under a Residence Order. The changes will be effective on and after 6 April 2010. This exemption does not apply where the carer is the child’s parents or step-parents.
