Budget holds good news for dentists
Headlines might focus on spending cuts but dentist are set to benefit from some of the chancellor's changes
The headlines from Chancellor George Osborne’s latest budget may focus on the fragility of the economy and further cuts to public spending, but there is at least some positive news on personal finance for dentists.
This is according to Job Drysdale of chartered financial planners PFM Dental. He told Scottish Dental what he thought the main points of interest would be for dental practitioners:
- Higher rate tax threshold to rise from £42,385 to £45,000 in April 2017. The majority of dentists are higher rate tax payers and will therefore feel the benefit.
- Many dentists employ their spouse and will take advantage of the tax-free personal allowance to rising to £11,500 also in April 2017.
- Annual Isa limit to rise from £15,000 to £20,000. This is a welcome increase to the alternative savings vehicle for those dentists no longer funding personal pensions (due to lifetime and annual allowance limits).
- Dentists trading as a limited company will welcome the changes to corporation tax, cut from 20 per cent to 17 per cent by April 2020. This may somewhat offset previously announced increases to dividend tax effective from April.
- Reforms to business rates will mean 6,000 small businesses pay no rates and 250,000 have their rates cuts from April 2017.
- Dentists buying a practice with a freehold property are likely to be affected by changes to commercial stamp duty – 0 per cent rate on purchases up to £150,000, 2 per cent on next £100,000 and 5 per cent top rate above £250,000. The freehold of a dental practice is often valued at less than £250,000 so this could be an advantage to many buyers. However, buying a larger freehold practice, especially one in the south east, could make you worse off.
Jon said: “The much anticipated changes to personal pensions and tax relief didn’t transpire – but we already expected that didn’t we?”
The much anticipated changes to personal pensions and tax relief didn't transpire – but we already expected that didn't we?
For more information on PFM Dental, including a more detailed appraisal of the 2016 budget, visit pfmdental.co.uk