The Autumn budget was delivered by the Chancellor on 22 November. Below is a brief summary of the key announcements on tax (not including measures covered in the Finance (No.2) Bill 2017 – 19):
- All gains by non-residents arising from the disposal of UK property (residential and commercial) will from April 2019 be subject to UK corporation tax (for companies) or UK capital gains tax (for individuals), with a targeted exemption for institutional investors (such as pension funds). In addition, from April 2020, income received by non-resident companies in respect of UK property will be chargeable to corporation tax, rather than income tax which might well mean increased tax through reduced reductions for interest expense. Further information on this consultation can be found on our Proskauer Tax Talks blog.
- With effect from 6 April 2018, the individual personal allowance will be increased from £11,500 to £11,850, the higher rate threshold will be increased from £45,000 to £46,350 and the CGT annual exempt amount will be increased from £11,300 to £11,700.
- The government will consult on relaxing the requirements for entrepreneurs' relief where individuals fall below the 5% threshold as a result of the company that they hold shares in raising funds for commercial purposes by means of an issue of new shares. The proposed changes will allow individuals to claim entrepreneurs' relief on that part of the gain that arose before their shareholding was diluted below 5%, even if they dispose of their shares after dilution.
- The government will be consulting on the introduction of new withholding tax obligations for non-UK residents in relation to payments of royalties by them to low/no tax jurisdictions where the royalties relate to sales to UK customers.
- The government will consult on changes to the tax treatment of intangible fixed assets to consider whether changes to the regime could better support UK companies investing in intellectual property.
- The VAT registration threshold will be retained and kept at £85,000 until 31 March 2020. The government will also conduct a consultation on the design of the VAT threshold.
- The assessment time limits for non-deliberate offshore tax non-compliance will be increased so HMRC can assess at least 12 years of back taxes, without needing to establish deliberate non-compliance.