Archive for the ‘Budget 2016’ Category

Changes to tax on property rents

Posted on: April 5th, 2016 by Sarah Curzon No Comments

Sarah CurzonThe past year has seen a number of announcements changing the way in which landlords are taxed on their property income. In particular, the letting of residential property will be adversely affected and following recent Budget announcements, George Osborne is making himself look like “the big bad wolf”.

Restriction on mortgage interest from April 2017

Perhaps the biggest change is to the way landlords claim tax relief on mortgage interest. We are finding that awareness of it, and how much damage it can do, is still not widely known.

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Budget 2016: Unexpected cheer in the Budget for Corporate Finance

Posted on: March 31st, 2016 by Leighton Reed No Comments

Leighton ReedThe key change in the recent budget was an unexpected reduction in Capital Gains Tax from 28% at the higher rate and 18% at the basic rate to 20% and 10% respectively.  Whilst this excluded residential property that does not benefit from Principal Private Residence relief, it will be a welcome reduction for anyone with items held for investment purposes.

Even more surprising was an extension to Entrepreneur’s Relief to external shareholders, i.e. those that are not officers or employees, but who own more than 5% of the voting share capital.  The intention is to encourage long term, stable investment in unlisted companies and improve the flow of capital by increasing the return available to investors. The further reduction in Corporation Tax rates announced will also increase the earnings available for distribution as dividends which should provide further incentive for investors and enable private companies to increase their attractiveness to them.

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Budget 2016: Property & Construction

Posted on: March 21st, 2016 by Denise Roberts No Comments

Denise Roberts (2)There were a number of announcements in the Chancellor’s Budget which will have a direct impact on the Construction and Real Estate Sector. But what does it all mean and how will it impact the sector?

Stamp Duty Land Tax

The new rates of stamp duty land tax (SDLT) (the extra 3%) for residential property purchases will apply from 1 April 2016 and there will not be a relief for people or companies buying in bulk as was previously expected. This will mean that all residential property purchases will be caught by the new provisions.

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Budget 2016: Changes for the Charity sector

Posted on: March 17th, 2016 by Sarah Case No Comments

Sarah CaseThis was a Budget that was not particularly focused on charities, a relief for many after the cuts and changes in previous Budget announcements.

Looking at the details from Budget 2016 below there are a number of headlines and analysis that may affect those in the charity and Not for Profit sector:

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Budget 2016 – The analysis

Posted on: March 16th, 2016 by Leighton Reed No Comments

Leighton ReedThe Chancellor badged this budget “a budget for the next generation”. In that respect he may be right because some of the changes he announced will take effect either in years to come or specifically for those under 40.

Several weeks ago, a large debate ensued on pensions with further changes expected on the amount of tax relief available when people save for retirement and on the tax free lump sum which can be taken on retirement. There had been sweeping changes to pensions in recent years and most did not wish to consider yet more. Fortunately the Chancellor decided to leave the current rules alone in favour of a new lifetime ISA for those under 40 in April 2017. The concept is that savers can put up to £4,000 aside each year until the age of 50 to help in retirement and during this time the Government will contribute £1 for every £4 saved which is effectively a 20% tax incentive.

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Budget 2016 preview: What are we likely to see?

Posted on: March 10th, 2016 by Leighton Reed No Comments

Leighton ReedIn our preview of Budget 2016, MHA Broomfield Alexander’s head of tax, Leighton Reed, offers his predictions.

It’s been barely a few months since George Osborne was basking in the glow of an election victory.

Subsequent summer budget and autumn statements saw several rabbits pulled out of hats due to lower than expected government borrowing costs and bigger than expected tax receipts.

Since then the forecast for the global economy has become gloomier with fears over another downturn and tax receipts expected to take a dip. There’s also the uncertainty of a possible EU exit hanging over the nation and the economy.

That said, Mr Osborne does have the certainty, for the time being at least, that interest rates are going to remain low, which means the costs of servicing the UK’s huge debt will also be lower. After the surprises of the last few major economic announcements it would be foolish to rule anything out, but I’m expecting a rather uneventful budget this time around.

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Budget 2016: Reform of pension tax relief

Posted on: January 25th, 2016 by Denise Roberts No Comments

Denise Roberts (2)David Gauke, the Financial Secretary to the Treasury was recently reported as noting that a review of pensions taxation in the March Budget would keep savers in mind. This announcement is likely to be seen as encouraging for those who wish pensions to continue to be taxed on withdrawal rather then on contributions.

However, on the other side of the coin ministers are considering changes to replace the current variable tax relief for pension contributions with a new flat rate. This reform would have significant implications for both savers and the exchequer.

At the current time basic rate taxpayers receive 20% tax relief, with higher rate tax payers receiving 40% and top rate tax payers receiving 45%.

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