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George Osborne felt obliged to move away from the simplicity which as a whole has marked his previous budgets and to make this his first budget of a sole conservative government innovative and complex.

Put simply he had to find £12 Billion of welfare cuts. He chose to target tax credits and in order to assist those most effected he introduced a significant increase in the national minimum wage (now christened the national living wage) thereby spreading the burden of these cuts between low earners and their employers.

Other commentators have said that in this budget he stole the opposition’s clothing, but for us, the main one he stole was Gordon Brown’s penchant for introducing loads of changes pre announced over several years which on the whole didn’t do very much.

So it appears to us that in order to hide who the victims of his £12billion raid were he introduced many other measures, most of which counteracted one another. The effect was that he spent half his time taking away with one hand what he had just given with the other.

As the budget had that many changes it is impossible to make a general prognosis as to whether this was beneficial or not to our clients as a whole, other than to state that low earning employees and their employers are worse off.

One particular sector of the market that will be affected adversely by this budget, is one man band limited companies especially personal service companies, who will lose the £2,000 (soon to be £3,000) National Insurance Rebate, as well as the government launching a consultative paper on the removal of the deduction for their travel expenses.

The areas that will affect the majority of our clients is the adding of a 7½ % tax charge on dividends. We have however tried to compare the current regime against the regime which the Chancellor has announced will exist at the end of this Parliament. That being, one of personal rate bands of £12,500 and the higher rate only starting at £50,000, with corporation tax rates of 18% and when one factors in all these, in addition to the increase in the tax rates on dividends, the net effect over a number of income levels for sole director, husband and wife companies is very minimal. In addition those companies with higher earnings but which restrict their income either to the basic rate band or to the level at which the child benefit starts to be reduced are actually overall no worse off, but are able to extract a far higher amount from the company than at present. Whilst we note that the increase in thresholds will be spread over the life of parliament, the new charge comes in next April, and so will increase tax bills in the short term.

In the March budget prior to the Election, the Chancellor specifically withheld from making any announcements regarding the annual investment allowance and he has now confirmed that this will be fixed at £200,000 per annum for the long term. Whilst this is a significant reduction on the £500,000, which has been in place for the last two years, it was always our understanding that these were temporary uplifts and that the balance would fall back. The revised limit of £200,000 is a significant improvement on the previous allowances and should mean that for the majority of our clients they will be getting full allowances in the first year on their capital acquisitions.

We also welcome the announcement on Inheritance Tax which significantly raises the thresholds although there is some disappointment that this is scaled back for larger Estates.

Those clients with buy to let properties held in their own names will be adversely affected by the limitation of the interest expense to basic rate tax only, although this is being phased in over a number of years.

A further measure announced is that the government are reverting back to the pre 2002 position on the treatment of intangible assets, and no longer giving tax relief on their amortisation.

Whilst many of his MP’s seemed pleased with the budget, for most businessmen a lot of dust will need to settle before we are able to judge if George Osborne’s first Tory budget was a good one or not.