Budget June 2010 - Initial reactions

"The commentaries below are written in general terms. Details can also be found in our downloadable Budget Report brochure. You are strongly recommended to seek specific advice before taking any action based on the information given, both in the commentaries and in the publication."

Here are some initial thoughts from some of our directors:

Mike Fosberry: Head of Financial services

"We welcome the drive to simplifying the pension contribution regime which is currently a minefield and the commitment to greater flexibility in pension planning at 75 with the effective increase in the annuitisation age to 77 with immediate effect and further consultation planned."

Paul Garwood: Head of personal financial planning

“Simplifying the withdrawal of tax relief on Pension contributions is likely to spread the burden of raising £3.5bn over a lot more people"

“The cost of Index linking State pensions will be cushioned by raising the State Pension Age to 66”

"Increasing CGT to 28% for higher rate taxpayers will encourage the transfer of assets to spouses paying basic rate tax before they are disposed of"

“This budget is forcing efficiency drives in public funding by reducing budgets, which leads us to ask how do we incentivise the public sector?”

Guy Rigby: Head of Entrepreneurs

“Hopefully the National Insurance breaks will encourage the proliferation of entrepreneurial businesses in areas that have been traditionally dominated by the public sector”

Mark McMullen: Director - Private client tax services

“The devil will, as always, be in the detail. However this Budget seems sensible, thoughtful and consultative. That said, the screw has been turned on many tax payers. I think that the mid year rise of CGT is, however, a mistake.  A pre-announcement would have given individuals the chance to consider, plan and perhaps sell which would in turn create revenue.  Only the brave (and well advised) would have been prepared for this and would have acted on this in time.”

Frank Akers-Douglas: Director - Private client tax services

Interestingly a lot was omitted from this emergency budget. There was no mention in the speech of inheritance tax, only a passing reference to the tax implications for non doms as well as no major anti - avoidance issues. The extension of furnished lettings will be a popular move…”

Simon Mabey: Chairman, Professional Practices Group

“The unprecedented decision to Introduce CGT mid year will have administrative implications. It will be interesting to see how losses are accounted for…”