The Budget on the 22nd June was George Osborne's first for the Coalition Government and will affect us all in one way or another.

Here are some of the areas that may affect you:

Income Tax Rates
- The personal allowance has been increased by £1,000, from £6,475 to £7,475 with effect from 6 April 2011.

- This will reduce the tax liability for lower paid employees and in particular those earning at or near the National Minimum Wage.

- The Chancellor committed to eventually raising the personal allowance to £10,000.

- Arrangements have been put in place to ensure that higher rate tax payers do not benefit from these changes.


National Insurance Contributions (NIC)
With effect from 6 April 2011:

- Employee NIC will rise by 1% to 12% (below upper earnings limit) or 2% (above upper earnings limit)

- Employer NIC will rise to 13.8%

- The threshold at which employers start to pay National Insurance Contributions will increase by £21 to £131 per week


VAT
With effect from 4 January 2011:

- The standard rate of VAT will be raised to 20%

- Zero rated and exempt items will not be impacted

Remember to claim your legitimate business expenses:
- Umbrella Employees
  Submit weekly expense claims to Crest Plus Exchange Limited
- Self Employed Subcontractors
  Through your Accountancy Provider at the end of the tax year

* You will need to submit VAT receipts regardless of your employment status.


Other:

- Tax credits: Reduced for families earnings over £40,000 next year. But low income families will get more Child Tax Credit - the amount per child will rise by £150 above the rate of inflation next year - at an annual cost of £2bn.

- IR35 is to be reviewed but there were no timescales set

- Plans to raise the state pension age for men to 66, possibly as early as 2016.

- No new increases in duties on alcohol, tobacco or fuel after the rises announced by the previous Labour government in the March Budget. And in addition, the plan to increase the duty on cider by 10% will be scrapped from the end of this month.


For further information:

HM Treasury's Budget Pages:
The BBC Budget Section