Budget 2008

There were no surprises in the 2008 Budget as most of the major announcements took place in October 2007 in the pre-budget report.  The announced changes to Capital Gains tax have been widely publicised.  From 6 April 2008 there will be a flat rate of Capital Gains tax of 18%.  This is good news for property investors as they will pay less tax after the 6 April.  The bad news is for anybody who wants to sell either their business or a business asset e.g. commercial property.  Under the old Capital Gains rules most people would only pay Capital Gains tax at a rate of 10% if selling a business asset.  As stated, the rate will be now be 18%.  When this change was announced back in October there was a great outcry from the business world.  In order to soften the blow a new relief called Entrepreneurs Relief will come into force.  In a nutshell gains relating to business assets up to 1 million will still pay tax at the 10% rate.  This is a lifetime limit.

Apart from the changes to Capital Gains, the only other major change is in relation to non domiciled individuals who are resident in the UK.

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