ÿþ<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN"> <html> <head> <title>Budget Report 2009</title> <title>Budget Highlights - Budget Report 2009</title> <link rel="stylesheet" href="branding/stylesheets/site.css" type="text/css"> <style type="text/css"> <!-- body { margin-left: 0px; margin-top: 0px; margin-right: 0px; margin-bottom: 0px; } --> </style> <script type="text/JavaScript"> <!-- function MM_preloadImages() { //v3.0 var d=document; if(d.images){ if(!d.MM_p) d.MM_p=new Array(); var i,j=d.MM_p.length,a=MM_preloadImages.arguments; for(i=0; i<a.length; i++) if (a[i].indexOf("#")!=0){ d.MM_p[j]=new Image; d.MM_p[j++].src=a[i];}} } function MM_swapImgRestore() { //v3.0 var i,x,a=document.MM_sr; for(i=0;a&&i<a.length&&(x=a[i])&&x.oSrc;i++) x.src=x.oSrc; } function MM_findObj(n, d) { //v4.01 var p,i,x; if(!d) d=document; if((p=n.indexOf("?"))>0&&parent.frames.length) { d=parent.frames[n.substring(p+1)].document; n=n.substring(0,p);} if(!(x=d[n])&&d.all) x=d.all[n]; for (i=0;!x&&i<d.forms.length;i++) x=d.forms[i][n]; 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height:20.1pt'> <p class=MsoNormal><b>Income Tax<o:p></o:p></b></p> </td> <td width=205 nowrap colspan=2 valign=bottom style='width:154.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><b><o:p>&nbsp;</o:p></b></p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><b>2009/10<o:p></o:p></b></p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><b>2010/11<o:p></o:p></b></p> </td> </tr> <tr style='mso-yfti-irow:1;height:20.1pt'> <td width=145 nowrap valign=bottom style='width:109.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=205 nowrap colspan=2 valign=bottom style='width:154.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> </tr> <tr style='mso-yfti-irow:2;height:20.1pt'> <td width=145 nowrap valign=bottom style='width:109.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>Basic rate band</p> </td> <td width=205 nowrap colspan=2 valign=bottom style='width:154.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>£37,400*</p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>£37,400*</p> </td> </tr> <tr style='mso-yfti-irow:3;height:20.1pt'> <td width=145 nowrap valign=bottom style='width:109.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><span style='mso-spacerun:yes'> </span>Tax rate</p> </td> <td width=205 nowrap colspan=2 valign=bottom style='width:154.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>20%</p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>20%</p> </td> </tr> <tr style='mso-yfti-irow:4;height:20.1pt'> <td width=351 nowrap colspan=3 valign=bottom style='width:263.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><span style='mso-spacerun:yes'> </span>Basic rate for dividend income</p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>10%</p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>10%</p> </td> </tr> <tr style='mso-yfti-irow:5;height:20.1pt'> <td width=351 nowrap colspan=3 valign=bottom style='width:263.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal>Higher rate – income over</p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>£37,400</p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>£37,400</p> </td> </tr> <tr style='mso-yfti-irow:6;height:20.1pt'> <td width=145 nowrap valign=bottom style='width:109.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><span style='mso-spacerun:yes'> </span>Higher rate</p> </td> <td width=205 nowrap colspan=2 valign=bottom style='width:154.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>40%</p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>40%</p> </td> </tr> <tr style='mso-yfti-irow:7;height:20.1pt'> <td width=351 nowrap colspan=3 valign=bottom style='width:263.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><span style='mso-spacerun:yes'> </span>Dividend upper rate</p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>32.5%</p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>32.5%</p> </td> </tr> <tr style='mso-yfti-irow:8;height:20.1pt'> <td width=351 nowrap colspan=3 valign=bottom style='width:263.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal>Additional rate – income over</p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>n/a</p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>£150,000</p> </td> </tr> <tr style='mso-yfti-irow:9;height:20.1pt'> <td width=351 nowrap colspan=3 valign=bottom style='width:263.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><span style='mso-spacerun:yes'> </span>Additional rate</p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>n/a</p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>50%</p> </td> </tr> <tr style='mso-yfti-irow:10;height:20.1pt'> <td width=351 nowrap colspan=3 valign=bottom style='width:263.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><span style='mso-spacerun:yes'> </span>Dividend additional rate</p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>n/a</p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>42.5%</p> </td> </tr> <tr style='mso-yfti-irow:11;height:20.1pt'> <td width=556 nowrap colspan=5 valign=bottom style='width:417.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> </tr> <tr style='mso-yfti-irow:12;height:20.1pt'> <td width=556 nowrap colspan=5 valign=bottom style='width:417.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><i style='mso-bidi-font-style:normal'><span style='font-size:11.0pt;mso-bidi-font-size:12.0pt'>* There is a 10% starting rate for savings income up to the starting rate limit within the basic rate band. Where taxable non-savings income does not fully occupy the starting rate band the remainder of the starting rate band is available for savings income.</span><o:p></o:p></i></p> </td> </tr> <tr style='mso-yfti-irow:13;height:20.1pt'> <td width=163 nowrap colspan=2 valign=bottom style='width:122.25pt; padding:0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=188 nowrap valign=bottom style='width:140.75pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> </tr> <tr style='mso-yfti-irow:14;height:20.1pt'> <td width=163 nowrap colspan=2 valign=bottom style='width:122.25pt; padding:0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><b style='mso-bidi-font-weight:normal'>Personal allowances<o:p></o:p></b></p> </td> <td width=188 nowrap valign=bottom style='width:140.75pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> </tr> <tr style='mso-yfti-irow:15;height:20.1pt'> <td width=163 nowrap colspan=2 valign=bottom style='width:122.25pt; padding:0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal>(age at the end of the tax year)</p> </td> <td width=188 nowrap valign=bottom style='width:140.75pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> </tr> <tr style='mso-yfti-irow:16;height:20.1pt'> <td width=163 nowrap colspan=2 valign=bottom style='width:122.25pt; padding:0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><span style='mso-spacerun:yes'> </span>Under 65</p> </td> <td width=188 nowrap valign=bottom style='width:140.75pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>£6,475</p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>£6,475</p> </td> </tr> <tr style='mso-yfti-irow:17;height:20.1pt'> <td width=163 nowrap colspan=2 valign=bottom style='width:122.25pt; padding:0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><span style='mso-spacerun:yes'> </span>65 – 74</p> </td> <td width=188 nowrap valign=bottom style='width:140.75pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>£9,490</p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>£9,490</p> </td> </tr> <tr style='mso-yfti-irow:18;height:20.1pt'> <td width=163 nowrap colspan=2 valign=bottom style='width:122.25pt; padding:0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal><span style='mso-spacerun:yes'> </span>75 and over</p> </td> <td width=188 nowrap valign=bottom style='width:140.75pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal><o:p>&nbsp;</o:p></p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>£9,640</p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>£9,640</p> </td> </tr> <tr style='mso-yfti-irow:19;height:20.1pt'> <td width=351 nowrap colspan=3 valign=bottom style='width:263.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal>Higher allowances scaled back if income exceeds</p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>£22,900</p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>£22,900</p> </td> </tr> <tr style='mso-yfti-irow:20;mso-yfti-lastrow:yes;height:20.1pt'> <td width=351 nowrap colspan=3 valign=bottom style='width:263.0pt;padding: 0in 5.4pt 0in 5.4pt;height:20.1pt'> <p class=MsoNormal>Adjusted net income above which personal allowances are tapered</p> </td> <td width=111 nowrap valign=bottom style='width:83.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>n/a</p> </td> <td width=95 nowrap valign=bottom style='width:71.0pt;padding:0in 5.4pt 0in 5.4pt; height:20.1pt'> <p class=MsoNormal>£100,000</p> </td> </tr> <![if !supportMisalignedColumns]> <tr height=0> <td width=145 style='border:none'></td> <td width=18 style='border:none'></td> <td width=188 style='border:none'></td> <td width=111 style='border:none'></td> <td width=95 style='border:none'></td> </tr> <![endif]> </table> <h1>National insurance contributions (NICs)</h1> <p>The lower earnings limit for 2010/11 will increase by £2 to £97 per week. All other main NIC rates and thresholds are unchanged for 2010/11.</p> <p>In his 2008 Pre-Budget Report the Chancellor announced that the main NIC rates would be increased by 0.5% for 2011/12. In his 2009 Report he announced a further 0.5% increase effective from 6 April 2011, taking rates to:</p> <table class=MsoTableGrid border=1 cellspacing=0 cellpadding=0 style='border-collapse:collapse;border:none;mso-border-alt:solid windowtext .5pt; mso-yfti-tbllook:480;mso-padding-alt:0in 5.4pt 0in 5.4pt;mso-border-insideh: .5pt solid windowtext;mso-border-insidev:.5pt solid windowtext'> <tr style='mso-yfti-irow:0;mso-yfti-firstrow:yes'> <td width=264 valign=top style='width:2.75in;border:solid windowtext 1.0pt; mso-border-alt:solid windowtext .5pt;padding:0in 5.4pt 0in 5.4pt'> <p class=MsoNormal>Employee Class 1 </p> </td> <td width=115 valign=top style='width:1.2in;border:solid windowtext 1.0pt; border-left:none;mso-border-left-alt:solid windowtext .5pt;mso-border-alt: solid windowtext .5pt;padding:0in 5.4pt 0in 5.4pt'> <p class=MsoNormal>12%</p> </td> </tr> <tr style='mso-yfti-irow:1'> <td width=264 valign=top style='width:2.75in;border:solid windowtext 1.0pt; border-top:none;mso-border-top-alt:solid windowtext .5pt;mso-border-alt:solid windowtext .5pt; padding:0in 5.4pt 0in 5.4pt'> <p class=MsoNormal>Employer Class 1 and Class 1 A/B</p> </td> <td width=115 valign=top style='width:1.2in;border-top:none;border-left:none; border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt; mso-border-top-alt:solid windowtext .5pt;mso-border-left-alt:solid windowtext .5pt; mso-border-alt:solid windowtext .5pt;padding:0in 5.4pt 0in 5.4pt'> <p class=MsoNormal>13.8%</p> </td> </tr> <tr style='mso-yfti-irow:2'> <td width=264 valign=top style='width:2.75in;border:solid windowtext 1.0pt; border-top:none;mso-border-top-alt:solid windowtext .5pt;mso-border-alt:solid windowtext .5pt; padding:0in 5.4pt 0in 5.4pt'> <p class=MsoNormal>Self-employed Class 4</p> </td> <td width=115 valign=top style='width:1.2in;border-top:none;border-left:none; border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt; mso-border-top-alt:solid windowtext .5pt;mso-border-left-alt:solid windowtext .5pt; mso-border-alt:solid windowtext .5pt;padding:0in 5.4pt 0in 5.4pt'> <p class=MsoNormal>9%</p> </td> </tr> <tr style='mso-yfti-irow:3;mso-yfti-lastrow:yes'> <td width=264 valign=top style='width:2.75in;border:solid windowtext 1.0pt; border-top:none;mso-border-top-alt:solid windowtext .5pt;mso-border-alt:solid windowtext .5pt; padding:0in 5.4pt 0in 5.4pt'> <p class=MsoNormal>Class 1/4 additional rate</p> </td> <td width=115 valign=top style='width:1.2in;border-top:none;border-left:none; border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt; mso-border-top-alt:solid windowtext .5pt;mso-border-left-alt:solid windowtext .5pt; mso-border-alt:solid windowtext .5pt;padding:0in 5.4pt 0in 5.4pt'> <p class=MsoNormal>2%</p> </td> </tr> </table> <p>With effect from 6 April 2011, the primary threshold and lower profit limits were to be broadly aligned with the income tax personal allowance. It has been announced that these thresholds will be increased by a further £570 to compensate the lowest earners (up to £20,000) for the increase in Class 1 and 4 rates.</p> <h1>Inheritance tax </h1> <p>The Chancellor announced that the inheritance tax allowance will be frozen at £325,000 for individuals and therefore a maximum of £650,000 for married couples and civil partners in 2010/11.</p> <h1>Capital gains tax (CGT)</h1> <p>There is no change in the annual exempt amount which remains at £10,100 for individuals and £5,050 for most trustees.</p> <h1>Child benefit</h1> <p>Child benefit will be increased by 30p to £20.30 per week from April 2010.</p> <h1>State Pension</h1> <p>The Pre-Budget Report announced that in April 2010 the level of the basic State Pension will increase by 2.5%, meaning a full basic State Pension will be worth £97.65 a week. The full couples rate for those whose entitlement is based on their spouse or civil partner s pension will increase to £156.15 a week.</p> <p>These increases are in line with the policy of uprating the basic State Pension by RPI or 2.5%, whichever is higher.</p> <h1>Pension Credit</h1> <p>There will be an above-indexation increase in the Pension Credit s minimum income guarantee to £132.60 for single pensioners and £202.40 for couples in 2009/10.</p> <h1>Tax relief on pension contributions</h1> <p>Budget 2009 announced that tax relief on pension contributions would be restricted from April 2011 for individuals with incomes of £150,000 and over.</p> <p>The Chancellor has now announced that the income definition for the £150,000 threshold will include the value of employer pension contributions.</p> <p>This will be subject to an income floor so that tax relief for those with incomes below £130,000 (before the inclusion of employer pension contributions) will not be restricted. They will still be subject to the existing annual and lifetime allowances.</p> <p>The anti-forestalling measures introduced at Budget 2009 will be extended from 9 December 2009 so that all those with incomes of £130,000 and over will be subject to the special annual allowance.</p> <h1>Furnished holiday lettings</h1> <p>The current furnished holiday lettings provisions (now applying to UK taxpayers with qualifying lettings elsewhere in the EEA) will be withdrawn with effect from 6 April 2010.</p> <p>From that date, furnished holiday lettings will be dealt with under the normal rules for the letting of property, and hence the following tax reliefs will no longer be available: · income tax sideways loss relief and capital allowances for new expenditure · capital gains tax entrepreneurs relief, business assets roll-over relief, relief for gifts of business assets; and · exemptions for disposals of shares by companies with a substantial shareholding. </p> <p>From 6 April 2010 income from furnished holiday lettings will cease to be relevant income for pension relief purposes.</p> <h1>Carers</h1> <p>Two new provisions affecting carers were announced.</p> <p><b>Income tax:</b></p> <p>The tax-free allowance will be available per household and consists of: · £10,000 fixed amount per tax year · £200 per week (or part week) per placement aged under 11; and · £250 per week (or part week) per placement aged 11 or over. </p> <p>Qualifying Shared Lives carers whose total receipts from providing care do not exceed the tax-free allowance for the year will be exempt from income tax on their income from providing Shared Lives care. Those whose receipts exceed the tax-free allowance for the year can choose to pay tax on either the amount by which their receipts exceed the allowance or on their profits calculated using the normal tax rules for businesses.</p> <p><b>Capital gains tax (CGT):</b></p> <p>Strictly, the CGT principal private residence (PPR) relief is not available for any part of the home which is used exclusively for the purpose of a trade, business, profession or vocation. Where a person cares for an adult under a local authority placement scheme, their contract may require them to set aside one or more rooms for the exclusive use of the adult in their care. </p> <p>Legislation to be introduced in the 2010 Finance Bill will remove the potential restriction on the PPR relief, for disposals on or after 9 December 2009.</p> <h1>Salary sacrifice  workplace canteens</h1> <p>Measures will be introduced from 6 April 2011 to remove the income tax exemption for meals provided in a canteen or on the employer s premises, in cases where the provision is linked to a salary sacrifice arrangement or a flexible benefits remuneration arrangement, where the food and drink provided (or the means of obtaining it) is commensurate with the amount of income given up.</p> <br /> <br /> <!--End Page Content--> </div></td> </tr> </table> </body> </html>