There were few surprises in the Budget – but will taxpayers be happy?
With a difficult backdrop to the economy and forecasts of lower growth the Chancellor delivered a Budget with few surprises which will be a relief to many. Enhancements to the research and development (R&D) regime will be welcomed as a lever to encourage investment and innovation and maintain competitiveness post-Brexit. Alongside the introduction of a tax on certain royalty payments the Government has also invited views on taxing the digital economy. A number of consultations were also announced around the taxation of work which employers will want to keep an eye on. Business will welcome the opportunity to engage in what could be significant future change. Within a boost for housing there was a measure of relief for first time buyers purchasing homes below £500,000. One surprise, however, was the extension of the current non UK resident capital gains tax regime to include commercial property and the disposal of property rich companies. This will warrant further examination.
On our dedicated Autumn Budget site we’ve covered what the Budget means for multinationals, businesses, employers and individuals, as well as our handy On a Page summary to get up to speed quickly on the key announcements. You can also listen to our webinar recording.
You will also find detailed commentary on the following measures on our Autumn Budget site:
SDLT Relief for First-time Buyers
A permanent SDLT relief has been introduced for first time buyers, effectively increasing the nil-rate threshold to £300,000, for purchases up to £500,000.
Increase in Research and Development credit is boost for innovation
An increase in credit means the UK Government will fund circa 10 percent of R&D expenditure.
Oil and Gas taxation – introduction of transferrable tax history
The Chancellor has announced that companies will be able to transfer tax history on the disposal of oil fields.
Changes to corporation tax on chargeable gains
CT on chargeable gains: Indexation allowance frozen from 1 January 2018 and depreciatory transactions time limit abolished from 22 November 2017.
Employment Status and the Taylor Review
The Government will publish a discussion paper as part of its response to the Taylor Review, exploring options for reform to employment status tests.
Off-payroll workers in the private sector
The Government has announced its intention to consult on the extension to the private sector of the IR35 reforms, introduced in the public sector earlier this year.
Corporate Tax and the Digital Economy: UK Government Position Paper
A position paper has been issued for taxing the digital economy. This is likely to be a game changer, particularly for social media companies and online marketplaces.
Taxing gains made by non-residents on UK immovable property
From April 2019 non-residents will be subject to capital gains tax on the disposal of all UK real estate.
Tax Advantaged - Venture Capital Incentives
Government increases investment allowance and incentives for knowledge-based start-ups but narrows relief for low-risk investments.
Extending assessment time limits for offshore non-compliance
HMRC plan to extend the assessing time limits for offshore tax non-compliance to 12 years, which is as much as tripling the current limit.
Amendments to corporate interest restriction legislation
Following further engagement with affected businesses, various amendments will be made to the enacted legislation to ensure the CIR rules work as intended.
And we have three further articles on some specific Autumn Budget announcements in Tax Matters Digest today:
WHT exemption for debt traded on a multilateral trading facility
The Government is extending the quoted Eurobond exemption which removes the obligation to withhold tax from UK source interest.
Amendments to the hybrids and other mismatch rules
A number of changes are proposed to be made to the hybrid and other mismatch rules, some with retrospective effect.
Indexation allowance impact for life insurance companies
Given the sizeable equity portfolios of many life insurers the industry may be more interested than most in this proposed change.
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