Just blew in from the windy city .......................
11 December 2013
December 5 2013 will be remembered for more momentous events but, closer to home, many of us were dealing with terrible weather, and the difficulties that ensued as a result. Others will remember it as the day the 2013 Autumn Statement was released by Chancellor George Osborne – his attempt to provide the nation with an insight into the government’s financial plans for the future.
Many of the announcements made will have a very limited scope, affecting only a small minority, but there were a number that are worthy of a mention:
- Principle Private Residence (PPR) relief
This valuable relief is currently available for up to three years after leaving your main residence, but from 6 April 2014 the extended PPR period will be reduced to eighteen months.
- Capital gains tax (CGT) for non-UK residents
Non-UK residents are generally not liable to CGT in the UK, subject to rules involving non-resident companies owning high value UK residential property. From 6 April 2015, individuals who live outside the UK and make a profit on the sale of a UK residential property of any value will be subject to CGT in the UK.
- Personal allowances transfer for married couples
The basic personal allowance is currently not transferrable between spouses, but from 6 April 2015, it will be possible to transfer £1,000 of allowances from one spouse to another, where neither is a higher rate tax payer.
- National insurance contributions (NIC) for employees who are under 21
Class 1 NIC is paid by employees and their employers, and is calculated based on the level of earnings received. From 6 April 2015, employers will no longer require to pay Class 1 secondary NIC on wages/salaries of up to £813 per week paid to those who are under 21 years old.
- Associated companies
Current corporation tax rules say that having “associated” companies (very broadly, those under common control) can increase the amount of corporation tax payable. The main rate and small companies rate of corporation tax will align from 1 April 2015, when the current associated company rules will be replaced by a new regime, yet to be established, which could affect the timing of corporation tax payments.
- Anti-avoidance measures
Steps will be taken to tackle tax avoidance and evasion, and while some of these are only at the consultation stage, it is likely that further announcements will follow. The areas being considered include the use of charities, offshore income, onshore employment intermediaries and avoidance schemes generally.
- Simplification of Inheritance Tax (IHT) charges on trusts
A consultation is to be held which, among other things, could increase the IHT chargeable on multiple trusts established by one settlor. The changes will be effective from 6 April 2015. We will be following the consultation in the interim, and will let you have any relevant updates.
If you’ve managed to recover from the calamity of torrential rain, gale force winds and the odd snow shower, and now perhaps want to take a closer look at what might be blowing your way in the coming months as a result of the Autumn Statement, please get in touch with your usual Springfords contact.
This is a general guide which is intended to give background information and is not a substitute for taking specific advice based on your particular circumstances.