Submitted by Sestini & Co
| on Wed, 12/03/2014 - 21:08 | In Uncategorized
At first sight, from a tax perspective at least a reasonably innocuous Autumn Statement: a slightly higher personal allowance, support for small businesses and much talk about the growth in the economy. A freeze in fuel duty. A couple more measures striving to ensure the banks/multi-nationals pay more, and naturally more talk about countering anti-avoidance.
There of course was the attention and headline-grabbing change to SDLT: a welcome move to a progressive rate (although still with a question mark as to whether it is a “good” tax in the first place).
But what else was there – not quite in the small print but missing from the headlines, the summaries and the first few pages of announcements?
- for non-UK domiciliaries, the remittance basis is now more expensive: the £50,000 remittance basis charge for those in the UK for 12 out of the last 14 years has increased to £60,000 and there is a new, higher charge for those in the UK for the past 17 years or more of £90,000 making it a much less attractive option for the majority of long term UK residents;
- the ATED charge on properties owned by “non-natural persons” is to increase by 50% above inflation: companies owning a residential property worth between £2m and £5m will pay £23,350 unless they meet one of a number of conditions for exemption (interestingly, ATED still works like old-style SDLT, on the “slab basis” rather than progressive rates);
- a welcome change in that entrepreneurs’ relief (ER) on gains rolled into another investment will still remain eligible for ER when they come back into charge: a measure to encourage more funding of qualifying EIS businesses and the like;
- in the IHT arena, we are also very pleased to see that the mooted single settlement nil-rate band is no longer on the agenda: this would have introduced more complexity into an already unwieldy IHT system;
- capital gains tax for non-residents: it is a relief that this was not extended beyond residential properties and that the ability to elect one’s PPR has not been abolished, as was feared, however there will now be an occupancy test so that non-resident individuals who have not spend 90 days in their property in the past year will be subject to capital gains tax;
- we are also planning to keep a watching brief on the mooted “simplification” of the employee benefits system and hoping it does not go the way of other “simplification” initiatives such as the pensions changes in 2006.
Of course, the devil is as always in the detail. If you have any questions or comments about any aspect of the 2014 Autumn Statement or would like a consultation to discuss how the changes might impact on you, please do not hesitate to contact us on firstname.lastname@example.org