Autumn Statement 2015: Beware the Ides of March
Making predictions about the future is always difficult – in Caesar’s case the above prediction was of course unfortunately true, but generally most predictions are usually wide of the mark!
In this context reading through the list of predictions made by various of the respected “tax pundits” this morning you would have thought that we were expecting a full scale Budget, the third in a year, when the Chancellor stood up to deliver his Autumn Statement 2015. What about Entrepreneurs’ Relief? What about the new rules taxing dividends? How can the rules concerning personal service companies be made more effective and make IR35 work as intended?
What did we end up with? Well, few of the predicted changes and certainly none of the widely touted changes to contentious and high profile areas such as Entrepreneurs’ relief or IR35 for example, and certainly none of the traditional rabbits out of the hat.
Instead this year’s Autumn Statement was accompanied by the Government’s first comprehensive spending review in five years and as a result focused on savings rather than large scale tax changes, with the Chancellor committed to delivering a Budget surplus of £10bn by 2020 in a rebuilt economy exhibiting sustained growth at a rate of 2.3%.
Inevitably there were some tax announcements, the most significant being:
- lots of targeted anti-avoidance legislation aimed at schemes involving disguised remuneration and perceived abuses of capital allowances and intangible assets
- a new penalty of 60% for tax planning caught by the General Anti Abuse Rule
- consultation on the rules concerning pension tax relief – can this be at risk yet again!
- consultation on the rules concerning company distributions and a targeted anti-avoidance rule to prevent opportunities for income to be converted to capital in order to gain a tax advantage
- a review of salary sacrifice arrangements – the Government says that it is concerned about these
- restricted tax relief for travel and subsistence expenses claimed by workers engaged through intermediaries.
Much consultation and a great deal to work through – the draft Finance Bill 2016 is shortly to be published and the hope is that much will become clearer then.