• Personal Allowances increased to £4895 from  £4745

• Starting Rate of Income Tax unchanged at 10%, threshold increased to £2,090

• Basic Rate of Tax unchanged at 22%; basic rate band increased to £32,400

• Higher Rate Tax unchanged at 40% and higher rate threshold increased to £32,401

• Contributions to Personal Pension schemes that are limited to an age-related percentage of earnings are subject to the pensions earnings cap of £105,600 for 2005-06

•  A new single pension regime is to be introduced for all pension schemes from 6^th April 2006 creating two key controls – (1) a lifetime allowance of £1.5m rising to £1.8m in 2010 and (2) an annual limit of £215,000 rising to £255,000 by 2010. Contributions will no longer be limited to a fraction of capped earnings. Individuals will be able to make unlimited contributions and tax relief will be given on the higher of 100% of relevant earnings or £3,600 where the individual contributes to a scheme that operates relief at source. The minimum pension age will increase from 50 to 55 by 2010 and the tax free lump sum will be limited to 25% of the value of the fund. There will also be no need to leave employment in order to draw the pension.

•  A council tax refund of £200 to each pensioner household

•  Individual Savings Accounts (ISA) investment limit of £7000 extended to 2010

• Same sex couples who are civil partners formed under the Civil Partnership Act 2004 will be treated the same as married couples for taxation purposes i.e. age related married couples allowance, Inheritance Tax, Capital Gains Tax, Pensions and Stamp Duty

• The standard rate of tax for Trusts has been increased to 40% from 6 April 2005

• From 6 April 2005 no tax charge arises on employees who purchase a computer or bicycle that has previously been loaned to them or another employee by their employer

• Child tax credit to rise by 13% in line with earnings, over the next three years

• Child benefit to rise to a maximum of £63 for the first child and £111 for two children

• Retention of state pension for pensioners whilst staying in hospital is to cease from 16^th March 2005

Business Taxation 

• There is to be a major change in the taxation of company vans.  From 6 April 2005 a nil charge will apply to employees who have to take their van home e.g. who are on call and are not allowed other private use. The current benefit in kind for all vans where private use is unrestricted is £500 (£300 for older vans) but from 6 April 2007 the scale charge will increase to £3000 and if an employer provides fuel for unrestricted private use an additional charge of £500 will apply. This will not apply to the self employed

• The current regime for company car benefits was introduced in April 2002.  Taxable benefits are calculated on the CO2 emissions of the car ranging from 15% - 35% of the list price of the car and the minimum petrol percentage charge has been frozen at 140 grams for 2005-2006 to 2007/08. An additional taxable benefit arises if the employee receives free fuel for the company car for private use which has been frozen at £14,400 for 2005-2006

• Standard rate of Landfill tax increased from £15 to £18 per tonne from 1^st April 2005

 Capital Taxation  

•  Annual exemption for capital gains tax up to £8,500

• Stamp Duty rates unchanged on business assets but zero rate threshold increased from £60,000 to £120,000 for residential property transactions, 1% payable from £120,000 to £250,000 effective on or after 17 March 2005

 Excise Duties

• Vehicle Excise duty frozen for cars, motor cycles and lorries but standard increase of £5 for vehicles over 1549cc and pre-March 2001 vehicles

• From 1st September 2005 excise duty on main road fuels will be increased by 1.22 pence per litre

• 1p increase on a pint of beer

• 4p increase on a bottle of wine

• Duty frozen on spirits, cider and sparkling wine

• Cigarettes up 7p per packet of 20

• Air passenger duty frozen

    Value Added Tax 

• VAT Limit increased to £60,000 (was £58,000) from 1 April 2005

• Churches can reclaim the full 17.5% VAT on repairs extended for three years

• Customs and Excise have extended the principle of Unjust Enrichment to all claims in respect of VAT overpaid

National Insurance 

• Primary and secondary thresholds will increase to £94 per week

• Rates of National Insurance Contributions 11% for employees on earnings from £94.01 to £630 per week, and 1% above £630 per year with 12.8% for employers from £94 per week

• Class 4 rate unchanged at  8% on profits between £4,895 and £32,760 per year with 1% above £32,760 per year

• Class 2 rate for the self employed increased to £2.10 per week

  Inheritance Tax 

•  Inheritance Tax threshold increased to £275,000 for 2005-06 (was £263,000), £285,000 next year and then to £300,000 for 2007-08

 Business Taxation

• Main rate of corporation tax unchanged at 30%

• Small rate of corporation tax unchanged at 19% for profits from £50,000 to £300,000

• Exempt band for corporation tax unchanged at £10,000

 National Minimum Wage

• The National Minimum Wage to be increased to £5.05 per hour from October 2005 from £4.85

 Regional Issues

• The first 7,800 civil servants to be moved out of London have now been moved to other parts of the UK to help regenerate the whole of the UK following the Lyons Report

• New building programme for primary schools to be established at a cost of £9.4bn upto 2010