Budget 16th March 2016

[Waldorf]

Are we expecting an easy ride on Budget Day?

As the finances have got tighter in the past few months I would not be surprised to find something hidden away on the day.

Remember IR35 was not leaked at the time and was a small note in the Budget documents, let's hope that we don't get something nasty.

[LisaContractorUmbrella]

I could well be wrong but I have a sneaky feeling that HMRC do have something up their sleeves; in the last meeting we had with them there were a few sphinx like smiles and that's never a good sign

[jamesbrown]

I could well be wrong but I have a sneaky feeling that HMRC do have something up their sleeves; in the last meeting we had with them there were a few sphinx like smiles and that's never a good sign

I think you're right. I watched Treasury Qs this morning and, in a response to a question about how the gov't are "helping" the self-employed, Greg Hands (Chief Sec) replied that we should wait for the budget. Perhaps it's just me (), but there was an element of menace about it. Possibly hypersensitive, but this gov't has form.

ps. Gidiot is surpassing the legend of Brown w/r to stealth taxation, and we know he can't raise the main taxes.

[LisaContractorUmbrella]

I think you're right. I watched Treasury Qs this morning and, in a response to a question about how the gov't are "helping" the self-employed, Greg Hands (Chief Sec) replied that we should wait for the budget. Perhaps it's just me (), but there was an element of menace about it. Possibly hypersensitive, but this gov't has form.

ps. Gidiot is surpassing the legend of Brown w/r to stealth taxation, and we know he can't raise the main taxes.

I don't think it's just you

[northernladuk]

I am fully expecting some very nasty surprises. I don't know if it's because I'm just naturally miserable or not but I just feel it in my bones. There has been so much focus on us and attempts to drag us in to line with T&S and divi tax I can't believe for one minute they've taken the foot off the gas. I foresee at least one surprise we didn't expect and a couple we did. I can feel it in my waters.....

[SimonMac]

There is talk that pensions are going to get hammered, everyone gets relief at a standard rate (25% has been mooted) rather than the upto 45% that is allowed at the moment, I doubt it would affect many people here, although for those who pay in from the company saving 19/20% on CT could this be a small bonus for us in switching to personal contributions instead.

[jamesbrown]

Pensions is a given, it's just a question of details.

The (endless) uncertainty is more about IR35 and how they plan to reconcile the two different T&S regimes/tests following the Autumn Statement. It's about time they publish the response to the IR35 discussion (approaching 6 months), which should give some clues. They haven't promised that nothing will be implemented in 16/17, just alluded to 17/18 as their target date. They talked about the ESI test being available in the "spring". Silence leading up to the budget would be a good indication that something is afoot (vs. the trial balloons of the Autumn Statement). There's been a continuous stream of stories since the Autumn Statement about avoidance through self-incorporation, so the pressure hasn't diminished. I think we're all expecting the worst to fall in 17/18, but it may happen sooner.

[Fred Bloggs]

I had thought that NIC on employer pension contributions was an outsider, but the more I see, the more I think it likely. The chancellor can still claim he hasn't increased the rate of NIC or income tax and the worker will see no impact on his payslip.

[WordIsBond]

I had thought that NIC on employer pension contributions was an outsider, but the more I see, the more I think it likely. The chancellor can still claim he hasn't increased the rate of NIC or income tax and the worker will see no impact on his payslip.

I'm starting to think this, too.

There have been rumours about a flat rate 25 or 33 percent relief on pension contributions. I don't see 33%, it would actually cost them money because basic rate people would be getting an additional 13%. So I think it will be 25%, enough to claim "I'm helping ordinary working families, but higher rate earners should pay more." (As if they don't already, what a novel idea.)

But higher rate earners can still get 40% with a salary sacrifice so their company pays into the pension. And one way to "solve" that is probably to make employers pay NIC on pension contributions. Chop 13.8% out of that 40% and you are getting close enough to 25% that it really doesn't matter.

I don't see this one as immediate effect, though. Companies need time to change their systems. He might make the personal contributions change have immediate effect, but even that would surprise me a little.

The one that scares me is taking away the tax free lump sum. I don't think he'll do that, but I no longer trust these guys to have any economic sense at all. It would absolutely kill pension savings.

Gordon Brown killed defined benefit plans, this lot are talking about doing things that would kill personal plans.

If you want people to lock their money away where they can't get at it for decades, so that you don't have to support them in their old age, you have to give them an incentive to do it. Most people are too short-termist to do it unless there is a strong incentive. But then, I don't see any evidence that those in power have a long term view, either.

[mudskipper]

I'm expecting something nasty with pensions - MyCo has just chucked an extra wodge into mine. But it seems likely that personal contributions would be an easier target than employer - although they're likely to follow in that they'll be taxed PAYE before relief applied.

But if we all had crystal balls, we'd walk like gypsies.