The Autumn Statement 2015 was given on Wednesday 25th November. Most of it was as expected, many proposals from the Summer budget being reiterated or confirmed, a dramatic U-turn on the tax credits cuts and increased investment in security.

The new stuff…..

Tax credits income threshold will remain at £6,420 from April 2016 and the tax credits taper will remain at 41% of gross income. After much public pressure the planned cuts for tax credits have been scrapped.

Higher rates of Stamp Duty Land Tax will be charged on the purchases of additional residential properties (above £40,000) such as buy to let or second homes. This will take effect from 1 April 2016. The rates will be 3% points higher than the current SDLT rates. The higher rate does not apply to corporate buyers.

The SDLT filing and payment period will also be changed from 30 days to 14 days from 2017/18.

A new apprenticeship levy is to be introduced in April 2017 at a rate of 0.5% of an employer’s paybill, to help increase the amount of apprenticeships available and will be paid through their PAYE. However a £15,000 allowance is given to every employer to offset against their levy payments, so only large employers with a paybill in excess of £3m will have to pay.

As mentioned previously there will be a big investment to change the current self assessment system, replacing annual tax returns with digital tax accounts. By 2016-17 access to digital tax accounts will be available for all small businesses and individuals. By 2020 most businesses, self employed people and landlords will be required to keep track of their tax affairs digitally and update HMRC at least quarterly.

Free childcare entitlement will be increased from 15 hours to 30 hours per week for 3 and 4 year olds from September 2017. This will apply to working families with an upper income limit of £100,000 and a minimum income level of 16 hours at the National Living Wage (£7.20 from April 2016). Tax Free Childcare is still set to start in early 2017 but the upper income level for this is now also £100,000 (down from the initially proposed £150,000) and the minimum income level is up from 8 hours to 16 hours at the NLW.

Capital Gains Tax on the disposal of any residential property is currently payable on 31 January following the tax year in which completion occurred. New rules are to be introduced from April 2019 which will require any CGT payable on the disposal of a residential property to be paid within 30 days of completion. A new system for reporting will need to be set up before this can happen, hence the delayed start.

The doubling of the Small Business Rate Relief in England has been extended for 12 months to April 2017.

The diesel supplement of 3 percentage points on company car tax is being retained until 2021.

As previously mentioned…..

  • Personal allowances will be £12,500 and the higher rate threshold will be £50,000 by the end of this Parliament.
  • As previously announced the rate of Corporation Tax will fall to 18% by the end of Parliament.
  • Annual Investment Allowance is held at £200,000.
  • Employment Allowance will rise to £3,000 from April 2016.
  • Following the consultation announced at March 2015 farmer’s averaging is still set to be increased from 2 years to 5 years from April 2016.
  • A confirmation was made of the plan announced in the Summer Budget to introduce the National Living Wage for workers aged 25 and over of £7.20 from April 2016. This will increase to over £9 by 2020.
  • No announcement was made regarding changes to the renewable and the Feed in Tariffs scheme. A response to the consultations that have been underway will be published shortly.