The March budget provided many interesting announcements relevant to Rockworth clients. The rate of income tax relief available to investors under the Enterprise Investment Scheme will go up from 20% to 30% and the annual investment allowed will increase from £500k to £1m (as of 2012). Coupled with the existing exemption from Capital Gains Tax after 3 yrs and Business property relief—we see this as a very strong source of potential investment for private businesses. The Entrepreneurs Relief will double from £5m to £10m as of 6 April 2011; this figure representing the life-time capital gains allowance where Capital Gains Tax is limited to 10%. Coupled with a reduction in the main rate of corporation tax, extension of R&D tax credits and creation of an additional 50,000 apprenticeships means there is plenty to consider for private companies that may or may not be considering M&A in 2011.
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