Budget 2016: Reducing the burden for small digital entrepreneurs

Budget 2016: Reduced burden on digital entrepreneurs

Jo Bateson, private client tax partner at KPMG in the UK comments on the changes to make it easier for the micro-entrepreneur announced in today’s budget.

Also on KPMG.com

Commenting on the changes to make it easier for the micro-entrepreneur announced in today’s budget, Jo Bateson, private client tax partner at KPMG in the UK, said:

“One consequence of the drive for digital innovation has been an increase in the ‘micro-entrepreneur’, earning small amounts of income from internet based activity. The Chancellor has confirmed that he wishes to support this form of entrepreneurism and has announced two new tax-free allowances.

“The Chancellor has accepted that for these individuals the current tax rules can seem daunting or complex. As a result he has announced that from April 2017 there will be two new £1,000 allowances for property and trading income. Individuals with property income or trading income below the level of allowance will no longer need to declare or pay tax on that income. Those with relevant incomes above £1,000 can benefit by simply deducting the allowance instead of calculating their exact expenses relating to the trade or property.

“There is limited information on the allowances available for those who, for example, use the likes of Airbnb to rent their room. We will need to wait to see how these two new allowances will interact with other existing allowances and the overall benefit to taxpayers before drawing a firm conclusion.”

Ends

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For further information please contact:

Roger Newby, FTI Consulting

M: +44 (0)7894 093 892

E: roger.newby@fticonsulting.com

KPMG Press office

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KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 12,000 partners and staff. The UK firm recorded a revenue of £1.96 billion in the year ended September 2015. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 155 countries and has 174,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.

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