The 2009 Pre-Budget Report was published on 9 December 2009. The Report covers a lot of issues but we will only focus on the ones affecting self employed individuals.
According to the Pre-Budget Report 2009, the tax rates and thresholds for the year ended on 5th April 2011 will remain the same as the ones for the current tax year. The same principle will apply to National Insurance Contributions rates and thresholds in 2010/2011.
But “for the tax year 2011/12, in addition to the 0.5% increases to rates already announced at PBR 2008, the Chancellor has announced that there will be a further 0.5% increase to those rates, making a 1% increase in total from 6 April 2011. The primary threshold and lower profits limit will be increased by £570 to compensate the lowest earners.”(HM Revenue and Customs).
The Child element when calculating the CTC entitlement will increase from the current £2235 p.a. to £2300 p.a while the disabled elements will increase by 1.5%.
Also, all elements of the WTC (except the childcare element) will increase by 1.5% in 2010/2011.
The income threshold for those claiming CTC rises from 2010/2011 to £16,190.
The inheritance tax threshold will be frozen at the current level of £325,000 from the tax year 2010/2011.
For any other details to do with the Pre-Budget Report 2009 please visit HMRC.