Our comprehensive Autumn Budget 2018 review

Philip Hammond presented his second Autumn Budget “for hard working families”, heralding the coming to an end of austerity. A range of spending measures were announced, together with a number of tax changes, which we have set out in our budget summary.

The headline is that entrepreneurs’ relief is staying although there have been some changes to ensure that the relief is being used for genuine entrepreneurial situations.

The team have put together a summary of the main tax changes that are likely to affect owner-managed businesses and personal taxpayers. Once the Finance Bill has been published on 7 November 2018 we will provide further comment on the some of the more relevant measures.

We hope you enjoy reading our analysis and if you want to talk through any of the detail please speak to one of the team.

OMB/ Entrepreneurs        

Proposed change to R&D tax relief for SMEs
Digital Services Tax
Entrepreneurs’ relief changes
Corporate capital loss restriction
Capital gains tax annual exemption amount
Capital allowances on the cost of altering land for the purpose of installing plant and machinery
Capital allowances for commercial structures and buildings
Capital allowance changes with effect from 29 October 2018 and onwards
Reform of corporate intangible fixed assets regime
Entrepreneurs’ relief and incorporation relief

Private Client
IHT: changes to Residence Nil Rate Band (RNRB)
Income tax allowance and bands
SDLT and First Time Buyer’s relief
Inheritance Tax – trusts settlement definition       

Employment

Employment Allowance Restricted
IR35 private sector reprieve until 2020 for ‘medium and large businesses’

VAT & Stamp Taxes
Stamp Duty on listed securities
UK property income and non-resident companies
VAT and vouchers
VAT anti-avoidance: construction industry reverse charge
VAT on unfulfilled supplies
VAT anti-avoidance: insurance intermediary services
VAT thresholds remain unchanged
VAT on reduced value supplies
VAT groups

Compliance/Non-compliance
Insolvency rules; HMRC as preferential creditor
Amendment to interest provisions for late payment, repayment and penalties
Transfer of corporate liabilities to the individual
SDLT: higher rates for additional dwellings- minor amendments
Tax returns submitted on a voluntary basis

Anti-avoidance
Electronic Sales Suppression (ESS)
Conditionality: hidden economy
International tax enforcement: disclosable arrangements
Offshore tax compliance strategy
Diverted Profits Tax amendments

Other
UK property income and non-resident companies
Income Tax: offshore receipts in respect of intangible property
Charities –increase in small trading exemption
Taxation of property gains of non-UK residents
Amendments to the UK corporation tax rules surrounding hybrid instruments and permanent establishments
Gift Aid small donations scheme