Autumn Statement 2014 - Headline Announcements
George Osborne’s last Autumn Statement speech before the General Election next May began with the proclamation that the UK is ‘on course for prosperity'. In the main, the Chancellor’s speech was somewhat of a review, comparing how far the UK economy had come since the last General Election in 2010. However, there were a number of headline measures which will affect all taxpayers as we move into 2015.
1. Personal tax and welfare
• The Income Tax personal allowance will increase from £10,000 to £10,600 from 6 April 2015.
• National Insurance Contributions will be abolished for apprentices under the age of 25, where they earn up to the Upper Earnings Limit. This measure will take effect from 6 April 2016.
• It was previously announced that all National Insurance Contributions will be abolished for workers under the age of 21, where they earn up to the Upper Earnings Limit. This will go ahead as planned, and will be extended to include support workers. This takes effect from 6 April 2015.
2. Taxation of pensions and savings
• Previously announced pension reforms, designed to make the regime more flexible, will go ahead as planned.
• Entrepreneurs’ Relief (ER) will not be applicable where individuals transfer goodwill they have generated to an associated close company. This fundamental change comes into effect from 3 December 2014.
4. Research & Development (R&D)
• The rate of relief applied to qualifying R&D expenditure will increase from 225% to 230% for SME’s from 1 April 2015.
5. Inheritance tax (IHT) and trusts
• Following a consultation launched after Budget 2014 with regards to the reforms to the taxation of trusts, the government will not introduce measures which restrict the nil rate band to one per settlor. It is proposed that other anti-avoidance measures will be implemented to counter the use of multiple trusts.
6. Property Tax
• The government proposes to completely overhaul the current Stamp Duty Land Tax (SDLT) regime.
7. Avoidance and evasion
• Further anti-avoidance measures were announced, including a consultation into proposed action against repeat users of marketed tax avoidance schemes.
If you would like more information or would like to discuss your tax affairs in general, please contact our Tax Partner, Chris Barrington on the details below:
telephone: 01942 292505