Gordon's
Green Light for Tax Planning
With
the general election behind us it may be worth considering
what the next five years could hold in store for small businesses.
Whilst
there have been no dramatic changes recently to small company
taxation the last budget did continue the trend of rewarding
successful owner-managed companies.
Recent
budgets have included a maximum 10% Capital Gains Tax
rate for owners selling a business that has been going
for more than four years.
|
|
Whilst they have also introduced
a clampdown on so-called personal service companies (those
with only one customer and trade similar to that of employment)
they have allowed tax-saving techniques for small trading
businesses to flourish. As a result most small businesses
will pay less tax as a Limited company than they would as
a sole trader although taxpayers should take advice on their
own unique circumstances. For growing businesses the last
budget extended the scope of the Enterprise Management Incentive
Scheme.
Other
tax planning tools used by small business such as Self
Invested Pension Plans (often used to buy commercial property)
and Employee Benefit Trusts were also ignored throughout
the whole of the last parliament.
There
can only be one conclusion. The Treasury has decided to put
its full weight into closing loopholes that can be exploited
by only the wealthiest taxpayers whilst giving the green light
to small businesses to arrange their affairs in a highly tax-efficient
way.
For
the well-advised business, good planning still pays.
|
