Pre-Budget Report 2009 Introduction Personal tax Tax rates and allowances Furnished holiday lettings Pensions and Credits State Pension Rates of tax credit National Insurance Contributions Rates and limits: 2010/11 Rates and limits: 2011/12 Employees Bankers' bonuses Electric cars and vans Cars up to 2012 Car fuel Works canteen Savings Pension contributions Capital Gains Tax Annual exemption and rate Inheritance Tax Rates and threshold Stamp Duty/Stamp Duty Land Tax Extended holiday ends Corporation Tax Rate of tax Business Tax Bank payroll tax Capital allowances Research and development Time to pay Empty property rates relief Value Added Tax Standard rate Flat rate Other Measures Equitable liability Offshore disclosure opportunity Public sector pay and pensions Tax avoidance

Flat rate The flat rate scheme for small traders operates by disallowing input tax on expenses, but allowing the trader to keep some of the output tax charged to customers in order to compensate. Different flat rates are set to reflect the different circumstances of each of over 50 categories of business. It is up to the business to decide which rate to apply, but HMRC can object to the choice made if they carry out an inspection. When the standard rate was cut from 17.5% to 15%, the flat rates were also reduced, but not by the same amount. On 1 January 2010, the flat rates change again, but they do not necessarily go back to where they were before. Some are higher, some are lower, some changes are 0.5% and some are up to 2.5%. Any FRS trader should consult the list on the HMRC website, or contact us, to make sure that they are applying the correct rate in 2010.