Welcome to the November edition of The Budget 2018 – Key points
- Income Tax Personal Allowance increases to £12,500 from April 2019
- Income Tax Higher Rate Threshold increases to £50,000 from April 2019 (except Scottish taxpayers)
- National Living Wage increases to £8.21/ hour from April 2019
- Annual Investment Allowance: increased from £200k to £1m for 2 years
- Long life asset writing down rate reduced from 8% to 6%
- CGT Private Residence Relief: lettings relief restricted to owners sharing with tenants
- CGT Entrepreneurs Relief: minimum holding period extended from 1 to 2 years
- VAT: registration threshold frozen for a further 2 years
- IR35 for the private sector: changes delayed to April 2020; will impact large and medium sized businesses only
- Digital Services Tax: a new tax proposed for very large businesses operating in the digital services space
- R&D Tax Credits: PAYE restriction reintroduced for the SME scheme
- HMRC to become a preferred creditor in insolvency cases
- Rates relief for small businesses: one third off for businesses in England with a rateable value of £51k or less
- Fuel, beer and spirits duties frozen; increases for wine, white cider and tobacco
The Chancellor Philip Hammond presented his second Autumn Budget on Monday 29 October 2018. In his speech he stated that ‘austerity is coming to an end – but discipline will remain’. He also promised a ‘double deal dividend’ if the Brexit negotiations are successful but stated that there may be a full-scale Spring Budget in 2019 if not.
Our summary focuses on the tax measures which may affect you, your family and your business. To help you decipher what was said we have included our own comments. If you have any questions please contact us for advice.
Main Budget tax proposals
- increases to the personal allowance and basic rate band
- extending off-payroll working to medium/large organisations in the private sector
- a temporary increase to the Annual Investment Allowance
- freezing the VAT registration threshold for a further two years
- changes to Entrepreneurs’ Relief and private residence relief
- measures to tackle the plastic problem.
Some Budget proposals may be subject to amendment in the 2019 Spring Statement and subsequent Finance Act. You should contact us before taking any action as a result of the contents of this summary.