A number of the proposals set out in the Autumn Statement, 3 December 2014, are effective from the 3rd or 4th December 2014. Take a look at the list below that includes details of the taxes affected. Food for thought as many of these changes will affect clients now.
- Stamp Duty : Stamp Duty Land Tax: reform of residential rates – The government will change the calculation of SDLT on purchases of residential property so that rates apply to the portion of the purchase price within each band. The government will also amend the rates and thresholds so that the portion of the transaction value up to £125,000 is charged at a rate of 0%, the portion between £125,001 and £250,000 is charged at a rate of 2%, the portion between £250,001 and £925,000 is charged at a rate of 5%, the portion between £925,001 and £1,500,000 is charged at a rate of 10% and the portion over £1,500,000 is charged at a rate of 12%. These changes will take effect on and after 4 December 2014. (Stamp Duty Land Tax Bill 2014) (4)
- Transfer of goodwill to a limited company: Restriction of Entrepreneurs’ Relief (ER). The government will prevent individuals from claiming ER on disposals of the reputation and customer relationships associated with a business (‘goodwill’) when they transfer the business to a related close company. This will affect transfers on or after 3 December 2014. (Finance Bill 2015) (36)
- Capital Gains Tax: Entrepreneurs’ Relief – The government will allow gains which are eligible for ER, but which are instead deferred into investments which qualify for the EIS or SITR, to remain eligible for ER when the gain is realised. This will benefit qualifying gains on disposals that would be eligible for ER but are deferred into EIS or SITR on or after 3 December 2014. (Finance Bill 2015) (17)
- Personal tax Miscellaneous loss relief – The government will legislate to counter the avoidance of Income Tax through miscellaneous loss relief by introducing anti-avoidance rules from 3 December 2014. From 6 April 2015 it will also limit the miscellaneous income against which a miscellaneous loss can be claimed. (Finance Bill 2015) (40)
- Undated gilts: The government announced on 3 December 2014 that it will: redeem 3½% War Loan at par in March 2015; adopt a strategy to remove all other undated gilts from the gilt portfolio where it is deemed value for money; bring forward enabling legislation for any future redemption of 2¾% Annuities, 2½% Annuities and 2½% Consolidated Stock.
- ISA surviving spouse advantage: From 3 December 2014, if an ISA saver in a marriage or civil partnership dies, their spouse or civil partner will inherit their ISA tax advantages. From 6 April 2015, surviving spouses will be able to invest as much into their own ISA as their spouse used to have, on top of their usual allowance, and so will be better able to secure their financial future and enjoy the tax advantages they previously shared.
This information is copied from the Autumn Statement that can be downloaded online at https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/382327/44695_Accessible.pdf