Possibly the most used word in the budget, after increase, was consultation. The Government plans to enter into consultation on a whole raft of tax legislation:
- There will be a full review of Corporation Tax in the autumn. The consultation process will look at the needs of small businesses and aim to provide legislation that will give certainty going forward. However, what sounded on budget day as a certain reduction in the main rate of Corporation Tax over the forthcoming years has since been watered down to a possible reduction.
- There is also to be a full review of the PAYE system. Some of the ideas that are being suggested, whilst a little impractical, are very radical. So we can only wait and see what kind of beast emerges from the consultation process.
- The Government is committed to a review of service companies and income shifting, an area that was put on the back burner by the previous government after many failures legislating in this area.
- Taxation of non-domiciled individuals will be reviewed yet again.
It is clear that the Government is prepared not only to tinker with the current tax legislation but to introduce complete reform where it deems it necessary.
So where does that leave us? Is it time to incorporate? – Potentially. Should I sell my investment properties before 5th April? – Perhaps. Will I still be able to pay my spouse dividends? – At the moment. What is guaranteed is that we will be paying close attention to all consultation documents to ensure that we are in the best position to advise you on any changes.
We have enclosed a Budget Summary setting out the main points in the budget in more detail.
Should you have any queries on the content of the budget or the impact of the changes on you then please do not hesitate in contacting us.
Charity Cycle Ride
This September Paul Morris, our tax specialist, will be cycling 320 miles from London to Paris to help raise money for the Everyman Male Cancer Campaign and Martin House Children’s Hospice.
If you would like to know more about Paul’s challenge, his chosen charities or to sponsor him please visit his web pages at:
Minford Chartered Accountants