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With the Autumn Statement just a few weeks away the tax team of Armstrong Watson has considered what to expect on 25 November.
Given that we have already had two budgets in 2015 the Autumn Statement may be light on specific tax changes. However, we expect to see the following:
Firstly, tax credit changes will need to be revisited as a result of the recent defeat in the House of Lords. No doubt there will still be changes but it will be interesting to see what compromise is reached to ensure the government can implement these.
The new universal state pension starts next year, providing the same pension for all. It is likely given this and the timetabled abolition of Class 2 NIC that Class 4 NIC (both paid by the self employed) will be increased to align with Class 1 NIC (paid by employees). The government made a commitment (the Tax Lock) not to increase NIC during the length of the Parliament but this was in respect of Class 1 only.
Hopefully we will also receive further clarification on certain changes already announced such as the Main Residence Nil Rate Band and the new rules in respect of dividend taxation – in both instances the impact on trusts is still unclear.
The travel and subsistence rules and the IR35 rules are both under review and changes are expected in both regards.
The Business Rates Review carried out earlier in the year promised a response by Budget 2016. This may be brought forward and reviewed in the Autumn Statement.
As always, there will, no doubt, be some anti-avoidance legislation. HMRC issue “spotlights” to raise awareness of schemes they have on their radar. There are still a number of contractor loan schemes being offered in the marketplace and I imagine HMRC has these schemes firmly in their sights.
Finally, for Carlisle where Armstrong Watson has three offices, we eagerly await an announcement that Kingmoor Park’s application for Enterprise Zone status has been accepted. This will bring businesses, jobs and wealth to the city and our fingers are firmly crossed.
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