Anna Brock, 37, runs a small business from her husband’s farm in Alton, Hampshire. The business, Anna’s Kitchen, makes traditional ready meals, pastries and puddings – but sales have suffered amid the credit crunch, and Mrs Brock has made two workers redundant.

The reduction in VAT from 17.5 per cent to 15 per cent will not benefit Mrs Brock since ready meals have a zero VAT rating, meaning that she does not charge VAT on her products and therefore she cannot reclaim any tax on the sales. However, she can claim back VAT on purchases made by the business, such as kitchen equipment.

Mrs Brock will be hit by a 0.5 per cent increase in employers’ national insurance contributions, the tax on employment, from 12.8 per cent to 13.3 per cent from 2011. As a consequence she will be about £136 per year worse off.

Mrs Brock said: “This made me really angry. I already have to pay the taxman about £380 per month in employer’s taxalone, just for the privilege of hiring local people and providing jobs for the community. An increase in this tax is the last thing I need.”

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Mrs Brock will, however, benefit from Alistair Darling’s decision to defer the increase in the small companies’ tax rate for a year. He had planned to increase the tax, which applies to businesses that make less than £300,000, from 21 per cent to 22 per cent in 2009.

She will also be able to agree with Revenue & Customs a new payment schedule for all taxes that is more suitable for her cash flow. “This is helpful because I currently pay my taxes at the end of the month and a little more flexibility with this would make things easier for me,” she says.

Mrs Brock could also benefit from a new £1 billion small business finance scheme, in which banks will provide government-backed loans to small businesses from next year. “I probably won’t take advantage of this, because I don’t want to get into debt,” she said.

Will your Christmas be better as a result of the PBR? No.

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