Tenon budget summary - what is it going to mean for most of us?

Children, and families with children, are the big winners.  Spending on education is to be increased, with the aim of ensuring that the level of investment per pupil in state schools is at least equal to the current level of investment per pupil in public schools.  Tax credits for families with children are to rise significantly and it is clear that the future tax cuts are to be delivered through tax credits rather than through the general increases in personal allowances or cuts in tax rates.

The second theme was clearly the package of increased measures to support entrepreneurial companies.  The Enterprise Investment Scheme, under which individuals can obtain income tax relief on investments in private trading companies, is to be significantly expanded, with the maximum amount eligible for relief to be doubled to £400K.   It has been notoriously difficult for investors to get themselves within the EIS regime, because it is hedged about with anti-avoidance rules, and I hope that in the long term the whole process of claiming EIS will be made much simpler.

As ever in the Budget the really interesting things are those which the Chancellor did not mention.  We are still working through the press releases, but already it is clear that there has been another very concerted attack on tax avoidance schemes with certain schemes being closed down with retrospective effect.  This is bound to be hugely controversial and I imagine that there is likely to be a real battle through the courts over whether or not such an approach can be justified.
 
As expected there has been a statement on the interaction of Inheritance Tax and the new pensions regime.  There had been some speculation that it would be possible to use the new pensions rules to avoid IHT on passing wealth down the family.  This has now been blocked and IHT will be due on the value of funds left in a pension scheme at the date of death where those funds can be used to benefit other family members.  The detail of this will take a lot of working out and I suspect that the picture will not be completely clear for a while yet.

The regime for research and development expenditure has been enhanced – in particular the higher rate of relief will be available to a larger number of companies.  Perhaps more important is a commitment to make the process of claiming relief less cumbersome.  Many companies who are currently entitled to relief have been put off making a claim because of all of the red tape involved and I hope that we can now finally move to a system under which all of those businesses who are entitled to relief will actually get it.