Aifa director general Chris Cummings has hit out at Chancellor Alistair Darling for announcing measures to mitigate increases in small business corporation tax for some industries but not advisers.
In last week’s Budget, the Chancellor set out a number of concessions to small businesses to help soften the increase in corporation tax on small firms from 19 per cent to 22 per cent, announced in the pre-Budget report.
These included increases to research and development tax credits and an injection of £60m into the small firm’s loan fund. But Cummings says this will not help advisers.
He says: “Over recent years, we have seen the total tax take from small businesses such as IFAs increase and unfortunately this Budget has done nothing to reverse the trend.
The Treasury’s mitigation measures are little relief for IFAs who will see their tax bill rise by at least 3 per cent. Very few professions will use the small firms loan guarantee.”
Cummings was also disappointed the Government did not increase the Isa limit above £7,200 and has called on it to link the threshold to the rate of inflation and review it every three years.
But Cummings welcomed the £12.5m capital fund crea_ ted to encourage women to start up businesses.
He says: “One positive announcement is the capital fund to encourage women entrepreneurs. We have seen an increase in women entering the IFA profession as the flexible nature of the adviser business model facilitates a better balance between work and other life priorities.”