Some good tax news at last - the Government has had to remove a lot of the proposed tax changes from their Finance Bill to get this passed before the General Election.
The abandoned clauses include:
- Digital reporting and record keeping (MTD) for income tax and VAT
- Dividend tax rate for 2018/19 (tax free amount dropping from £5K to £2K)
- £1,000 tax free allowances for property and sundry income
- £500 tax free pensions advice
- Changes to taxation of terminations payments
- Reduction in money purchase annual allowance from £10,000 to £4000
- Power to tax capital gains made from UK land as income tax not CGT
- Deemed domicile for all taxes for non-doms
- Changes to substantial shareholding exemption
- Changes to EIS, SEIS, SITR and VCT schemes
- Restrictions on corporation tax losses
- Tax relief for cost of Museum exhibitions
- VAT in relation to goods stored in UK warehouses
What Remains In?
The following significant provisions remain in the draft Bill:
- Income tax rates for 2017/18
- Corporation tax rate for 2018
- Air passenger duty rates for 2017
- Insurance premium tax rates from June 2017
- IR35 for the public sector
- VED duty rates from April 2017
- Alcohol and tobacco duty rates
- Soft drinks levy
- Changes to salary sacrifice schemes
- Deduction of tax at source
- Abolition of Employer Shareholder Scheme
Note the IR35 provisions for workers performing contracts in the public sector remain in the Bill although it is a contentious and badly drafted piece of law.
What Happens Now?
Sadly, we think that many of the clauses now OUT are simply being postponed until after the election, subject of course to the which Political Party gets in and their majority.