Category Archives: Budget

Key Points From Budget 2018


Key Points From Budget 2018

BUDGET 2018 KEY POINTS

Budget 2018

On Monday 29th October the Chancellor Phil Hammond stood up in Parliament to deliver his Budget – here are some of the key points:-

In a longer than usual Budget speech, and in a slightly more jocular than usual mood, the Chancellor laid out the government’s vision for post-Brexit Britain. With a raft of measures aimed at shoring up businesses, infrastructure and the health service, Mr Hammond used the better than expected public finances to present an upbeat programme. Leaving some of the major announcements for last, this was a Budget to mark the coming of the end of austerity.

Some of the main announcements were:

  • The personal allowance will be raised to £12,500 from April 2019, one year earlier than planned. The higher rate threshold will also rise to £50,000 from April 2019, also a year earlier than planned, and will remain at the same level in 2020/21.
  • The lifetime allowance for pension savings will increase to £1,055,000 for 2019/20 in line with CPI.
  • The national living wage will increase from £7.83 an hour to £8.21.
  • The annual investment allowance (AIA) will increase to £1 million for all qualifying investments in plant and machinery made on or after 1 January 2019 until 31 December 2020.
  • For entrepreneurs’ relief, the minimum period throughout which the qualifying conditions for relief must be met will be extended from 12 months to 24 months from 6 April 2019.
  • From 1 April 2020, companies will be subject to a 50% limit on the proportion of annual capital gains that can be relieved by brought-forward capital losses. Companies will have unrestricted use of up to £5 million capital or income losses each year.
  • Business rates bills will be cut by one-third for retail properties with a rateable value below £51,000 for two years from April 2019.
  • Capital gains tax lettings relief will only apply where the owner of the property is in shared occupancy with the tenant. The final period exemption will also be generally reduced from 18 months to nine months.
  • The VAT registration threshold be maintained at the current level of £85,000 until April 2022.
  • From 1 April 2020, the amount of payable research and development (R&D) tax credits that a qualifying loss-making company can receive in any tax year will be restricted to three times the company’s total PAYE and NICs liability for that year.
  • From 6 April 2020, when a business enters insolvency, HMRC will be a preferred creditor for taxes collected by the business for the government such as VAT, PAYE income tax, employee NICs, and construction industry scheme deductions – but not such taxes as corporation tax and employer NICs.
  • Large social media platforms, search engines and online marketplaces will be pay a 2% tax on the revenues they earn which are linked to UK users from April 2020.
  • Fuel duty was frozen, alongside beer and spirits.

An in depth analysis of the Budget will be available shortly.  Contact Paul Southward or your usual KSK contact if you have any queries about yesterday’s Budget proposals.

See our Budget summary here:

Budget 2018 Summary

 

Paul Southward


2018 Budget Set for 29th October


2018 Budget Set for 29th October

BUDGET 2018

Phil Avoids Halloween Nightmare with a break from tradition

The traditional day for a Budget is Wednesday, this year however, the Chancellor Philip Hammond will deliver his Budget on a Monday.

Whilst the Treasury deny all claims that the switch in days is to avoid the nightmare scenario of Spreadsheet Phil delivering his Budget on Wednesday 31st October that just happens to be Halloweens; we suspect that it was a consideration.

HORRORS

Can you imagine the mileage that the press would get from any Horrors revealed by Phil.

Accordingly, the Chancellor of the Exchequer, Philip Hammond, has announced that the government will publish its next Autumn Budget on Monday 29 October 2018, leaving only four weeks for preparation

This comes after weeks of speculation of when this year’s Budget speech would be delivered.  After much stalling Phil has finally released the date.

At the Autumn Statement in late December 2016, the Chancellor announced that the government were to move to a single major fiscal event each year, pointing out that the UK is the only major advanced economy to make major changes to the tax system twice a year.  Therefore following the Spring Budget in 2017, the government moved to a single fiscal event in autumn.

The Budget was originally expected in late November or early December, but the Chancellor has pushed forward his annual Budget to avoid Brexit discussions. There were concerns about whether Brexit talks and possible deals could effect any announcements in the Autumn Budget.

This year’s Budget is to be earlier than usual to avoid clashing with the final stage of Brexit negotiations in November.

The date of the Budget, 29 October, also fits in with ministers’ availability and official data releases, a Treasury spokesman said.

The Budget will also be a week after a high profile Brussels Brexit summit.

Mr Hammond gave the date in a tweet, saying the government’s approach to the economy was “getting debt falling”.

If you want to learn more contact Paul Southward.

Paul Southward


Autumn Budget 2017


AUTUMN BUDGET 2017

The Chancellor’s second Budget of 2017

Mr Hammond will probably be pleased if commentators decide that his Autumn Budget was a steady-as-she-goes, broadly modest Budget. After the national insurance u-turn he was forced to make after his March Budget this year, that was probably his aim.

In any case, for a variety of economic and political reasons, the Chancellor announced a relatively modest net tax giveaway of just under £1.6 billion for the coming tax year.

His main attention-seeking move was to give first time buyers an exemption from stamp duty land tax on the first £300,000 of value for properties worth up to £500,000. Rumours – probably from the Treasury itself – had trailed changes along these lines, and the new relief represents more than a third of his net giveaway.

With income tax, the changes were much less dramatic – increasing both the personal allowance and the higher rate threshold by 3% – the standard inflation-linked increase. ISA investors saw their main ISA and lifetime ISA investment limits frozen and only children saw a small increase in their specialist ISAs. There was better news for pension savers who enjoyed a £30,000 increase in the lifetime allowance and thankfully no cuts to the annual allowance.

Several measures were designed to introduce much more of a focus on risk investment for venture capital trusts, enterprise investment schemes and seed enterprise investment schemes.

Most Chancellors tend to cram all the painful announcements into Budgets at the start of a Parliament; for a range of reasons, Mr Hammond decided that he did not need – or perhaps couldn’t afford – to do this.

To view the KSK Autumn Budget 2017 summary click here:-

Autumn Budget 2017

If you have any queries regarding your tax affairs or matters raised in the Budget contact Paul Southward

Paul Southward


Autumn Budget 2017


Autumn Budget 2017

KEY POINTS

If the chancellor was asked to produce a Budget that would not rock the political boat, then it looks as if that is what he has delivered. The total net cost of his policy decisions for 2018/19 was a little over £6 billion with just £1.585 billion attributable to tax policy decisions.

The main tax changes announced were as follows:

  • First time buyers (outside Scotland) will pay no stamp duty land tax on the first £300,000 of the purchase price for a home provided its value does not exceed £500,000. Gains on disposals of all UK property (including commercial property) will be subject to UK tax on gains by non-UK residents accruing from April 2019.
  • The corporate indexation allowance will be frozen from January 2018, so that companies will no long benefit from relief for inflation after this date on their capital gains.
  • The VAT registration threshold will be frozen at £85,000 for 2018/19 and 2019/20.
  • Online marketplaces will become jointly and severally liable for the unpaid VAT of all UK traders, as well as overseas traders.
  • Relief for venture capital trusts, enterprise investment schemes and seed enterprise investment schemes will be focused on companies where there is a real investment risk. A number of other provisions will tighten up the rules for these investments.
  • The existing diesel supplement for diesel company cars will be increased from 3% to 4% from April 2018 for cars that do not meet the RDE2 emissions limits. The fuel benefit and van benefit charges will increase in line with RPI (and vehicle excise duty) from April 2018.
  • There will be a number of changes to business rates, including: bringing forward to 2018 the switch in indexation from RPI to the generally lower CPI; retrospective legislation to deal with the impact of the so-called ‘staircase tax’ by recalculating valuations and qualification for small business relief to the position in the period before April 2010; increasing the frequency of revaluations to every three years after the next valuation due in 2022.
  • The pension lifetime allowance will be increased from £1 million to £1.03 million from April 2018. There will be no change to the annual allowance.
  • The ISA limit will be frozen at £20,000 and the LISA limit at £4,000, but the junior ISA and child trust funds will rise to £4,260 from April 2018.
  • The income tax personal allowance will rise to £11,850 and the higher rate tax threshold for the UK (excluding non-savings, non-dividend income in Scotland) will rise to £46,350 for 2018/19.
  • There will be a raft of provision against tax avoidance and evasion. The government will consult on further measures to tackle non-compliance with the intermediaries legislation (often known as IR35) in the private sector. A possible step will be to extend the recent public sector changes to the private sector.
  • The government will also consult on reforming the taxation of trusts.

U-Turn On Self Employed Class 4 NIC Increases


U-Turn On Self Employed Class 4 NIC Increases

SPRING BUDGET UPDATE

The Chancellor announced on 15 March that he would not be going ahead with his Budget proposal to increase the National Insurance Contribution rates for self-employed people.

In the Budget of 8 March 2017, he announced that Class 4 NIC rate for the self-employed would rise by 1% to 10% in 2018/19 and by a further 1% in 2019/20. The proposed increases provoked a widespread outcry. Not least because the Conservatives 2015 election manifesto stated “we can commit to no increases in VAT, Income Tax or National Insurance.”

A week later, perhaps appropriately on the Ides of March, the Chancellor issued a letter to MPs saying that there would be no increase to Class 4 NICs “in this Parliament”. However, the abolition of Class 2 NICs will still go ahead from April 2018, meaning that the self-employed will generally see their NICs bill fall from 2018/19.

At Prime Minister’s Questions, Mrs May has said that the government would review areas of difference in the treatment of the employed and self-employed. This will follow a forthcoming report of modern working practices being prepared by Martin Taylor. Mrs May’s comments reiterated a point made by the Chancellor, who also wrote in his letter that “The cost of the changes … will be funded by measures to be announced in the Autumn Budget.”

Watch this space for further U-Turns on the governments tax policies for making tax digital…

Delay launch of MTD project, committee urges

A report from the House of Lords Economic Affairs Committee has called on the Government to delay the launch of its “Making Tax Digital” (MTD) scheme until 2020 and make it optional for many small firms and self-employed workers. The committee’s report found that not enough consideration has been given to support those lacking digital skills: with HMRC’s own research showing that 61% of the self-employed cannot or need help to interact with the Government online. In last week’s budget, Philip Hammond responded to criticism of MTD by delaying its implementation for businesses with a turnover of less than £83,000, the VAT threshold, until April 2019. Lord Hollick, chairman of the committee, said: “This does not go nearly far enough and [the government] needs to further delay the scheme’s implementation, and take a more incremental and gradual approach based upon the evidence.”

The Times, Page: 37    Independent I, Page: 48   Yorkshire Post, Page: 20   Daily Mail, Page: 12

2017 SPRING BUDGET SUMMARY

To see our 2017 Spring Budget summary click here:-

goo.gl/00Aqct

2017 TAX TABLES

If you wish to download a copy of this incredibly useful document click here:-

https://goo.gl/P8F3Wj

If you have any queries or require a pocket sized hard copy of our 2017 tax tables  contact me:-

Paul Southward

 


2017/18 Tax Tables


2017/18 Tax Tables

Our new tax tables publication for 2017/18 has now been published; this handy document is crammed full of useful and invaluable information. It is a veritable Aladin’s Cave of essential tax information.  You can download a copy to keep on your phone, tablet or personal computer.  If you prefer, you can order a pocket sized card to carry with you as a handy reminder.

To give you an idea of how much information this guide holds here is a summary of the main content:-

INCOME TAX

Rates and rate bands.

Compare income tax rates across two years, 2016/17 and the latest for 2017/18.

UK rates and rates for Scotland.

Basic rate.

Higher and additional rates.

Dividend allowance and tax rates.

Rates for Trusts.

Child Benefit Charge

Main Personal Allowances and Reliefs

Rent-a-room relief

Non-Domicile remittance basis after UK residence period

REGISTERED PENSIONS

Lifetime allowance.

Annual allowance.

NATIONAL INSURANCE CONTRIBUTIONS

Classes 1, 1A, 2, 3 and 4.

Employment allowance

Limits and thresholds

STATE PENSIONS

Weekly and annual.

Pension Credit.

PROPERTY TRANSACTION TAXES

SDLT.

LBTT (Scotland).

Second properties.

Annual tax on enveloped dwellings (ATED).

Stamp Duty.

TAX INCENTIVISED INVESTMENTS

ISA.

VCT.

EIS.

CAPITAL GAINS TAX

Rates for Individuals.

Rates for Trusts and Estates.

Surcharge (for residential properties).

Exemptions

Individuals, Estates and Trusts.

Chattels.

Entrepreneur’s Relief

Rates and limits.

INHERITANCE TAX

Nil rate band.

Reduced nil rate band.

Tax rates.

Reliefs.

Gifts relief.

Taper rates on lifetime gifts.

CORPORATION TAX

Rates.

VALUE ADDED TAX

Rates.

Registration and Deregistration limits.

Flat Rate Scheme turnover limit.

Cash and annual accounting scheme turnover limit.

CAR BENEFITS

Percentage rates.

Fuel benefits.

VAN BENEFIT

Benefit charges.

Fuel charge.

TAX FREE BUSINESS MILEAGE ALLOWANCE

Cars.

Passengers.

Motorcycles, and

Bicycles.

MAIN CAPITAL AND OTHER ALLOWANCES

Annual investment allowance.

Enterprise zone.

Writing down allowance rates.

Energy and water efficient equipment.

Electric vans.

Motor Cars

Research and Development

SOCIAL SECURITY AND OTHER USEFUL RATES

Attendance allowance.

Carers allowance.

Employment and support allowance.

Statutory pay rates.

(SSP) Statutory sick pay .

(SMP) Statutory maternity pay.

(SAP) Statutory adoption pay.

(SPP) Statutory paternity pay.

Shared parental pay (ShPP).

Jobseekers allowance.

National minimum/National living wage.

MAIN DUE DATES FOR PAYMENT

Income tax, NIC and Capital gains tax.

Inheritance tax.

Corporation tax.

2017 CALENDAR

If you wish to download a copy of this incredibly useful document click here:-

https://goo.gl/P8F3Wj

If you have any queries or require a pocket sized hard copy contact me:-

Paul Southward

Paul Southward


The Chancellor’s first – and last – Spring Budget


The Chancellor’s first – and last – Spring Budget

2017 SPRING BUDGET

The 2017 Spring Budget will be the last of its type. Probably.

SPREADSHEET PHIL

The publication of the Finance Bill in the spring/summer of this year will presage a change in Parliamentary proceedings. A second Budget in autumn 2017 followed by a Spring Statement in 2018 marks the start of a process. This should enable Parliament to scrutinise tax changes well before the tax year where most will take effect.

As if the domestic ‘flip-flopping’ of a long-standing timetable wasn’t enough, the Chancellor, Philip Hammond, delivered his first Budget speech against a backdrop of Brexit uncertainty.

Before he stood up, punters could have obtained long odds about witnessing a wise-cracking ‘Spreadsheet Phil’, as he has become known. Standing at the despatch box (the joke-o-meter registered seven during his hour-long address).

But beyond the laughs from the government benches combined with Opposition scowls, the Chancellor sent out some fairly serious messages.

SELF EMPLOYED TARGETTED

Phil has delivered a fiscally-tight Budget in a bid to raise billions of pounds. This is to provide a “strong and stable platform” for the UK’s negotiations as it navigates a path away from the EU. Those targeted included  self-employed, company owners and investors.   

He also proposed to enhance the fairness in the UK’s tax system with a view to transforming the economy into one that works for everyone.

SAVINGS

ISA allowances are set to be worth £20,000 from April 2017. However the tax-free dividend allowance reduces from £5,000 to £2,000 from April 2018. Taxpayers are encouraged to contact their professional advisers to ensure they do not lose out or get caught unawares by these changes.

BUSINESSES

Businesses will need to seek out rates advice on their premises following the impending changes to the system. There may be some respite with the relief measures announced by the Chancellor.

And that’s before the Chancellor even thinks about his Autumn Budget announcements…

To see our 2017 Spring Budget summary click here:-

goo.gl/00Aqct

If you have any queries, contact me:-

Paul Southward

Paul Southward

 

 

 

 


Lifetime ISA


In his Budget speech today, the chancellor George Osborne announced: Lifetime ISA

This is a quick summary of how they will work.

Save up to £4,000 each year, and receive a government bonus of 25% – that’s a bonus of up to £1,000 a year. You can use some or all of the money to buy your first home, or keep it until you’re 60 – it’s up to you.

* open a Lifetime ISA account between the ages of 18 and 40, and any savings you put into it before your 50th birthday will receive an added 25% bonus from the government

* accounts will be available from April 2017

* there is no maximum monthly contribution – you can save as little or as much as you want each month, up to £4,000 a year

* the total amount you can save each year into all ISAs will also be increased from £15,240 to £20,000 from April 2017

use it to save for a first home

* your savings and the bonus can be used towards a deposit on a first home worth up to £450,000 across the country

* accounts are limited to one per person rather than one per home – so two first time buyers can both receive a bonus when buying together

* if you have a Help to Buy: ISA you can transfer those savings into the Lifetime ISA in 2017, or continue saving into both – but you will only be able to use the bonus from one to buy a house

use it to save for retirement

* after your 60th birthday you can take out all the savings tax-free

* you can withdraw the money at any time before you turn 60, but you will lose the government bonus (and any interest or growth on this). You will also have to pay a 5% charge