You are here
Home > Financial > What will be in the Chancellor’s Autumn Statement? Baker Tilly in Yorkshire predicts…

What will be in the Chancellor’s Autumn Statement? Baker Tilly in Yorkshire predicts…

With the Autumn Statement only a few days away, Baker Tilly predicts what the Chancellor could say when he reaches the Despatch Box…

Capital gains tax (CGT) is predicted to be introduced for the disposal of UK property held by non-UK resident individuals.

This new tax charge and the frequency to changes in the taxation of UK property may drive overseas investors away from the UK. CGT entrepreneurs’ relief lifetime allowance may also be cut from £10m, and a cap introduced to limit lifetime ISA investment.

Pensions are also predicted to be affected, with the possibility of the introduction of a cap to limit the lump sum that can be paid tax-free.

This will be a particular blow to those relying on a larger sum, for example, to start their retirement early.

With HMRC’s consultation document on the simplification of inheritance tax and trusts due for release shortly, the Chancellor might use the opportunity to introduce a restriction on the use of multiple trusts.

Tax avoidance by multinationals will almost certainly appear in the Autumn Statement, and so Mr Osborne could reveal HMRC’s perspective on the Base Erosion and Profit Shifting Action Plan which was published by the OECD last July.

This will affect all multinational enterprises (foreign and UK-parented) that try to plan their tax affairs internationally, and will represent one of the biggest shake-up of tax rules governing international taxation.

The ‘naming and shaming’ of promoters of avoidance schemes could be announced, as well as an extension of the annual tax on enveloped dwelling (ATED), and possibly an extension of the charge to properties owned by all non-residents and a wider range of ‘envelopes’.

Fundamental changes to PAYE Real Time Information (RTI) are predicted, possibly with an extension to the temporary relaxation of the ‘on or before payment’ reporting rule, and a rethink of the relationship between RTI and Universal Credit.

More good news is also expected for employees as the Chancellor may announce a reduction in the length of service needed before employees can be given a tax and NICs-free long service award.

George Osborne might also announce a move to extend VAT recovery to four years for public bodies, as well as legislation to be introduced that will allow manufacturers to offset any refunds given to final customers against their initial output VAT liability on their sale of the goods.

Tim Parr, Tax Partner at Baker Tilly’s office in Leeds, said: 

“Clearly the Chancellor is going to have to make some tough decisions ahead of the forthcoming election next year.

“He’ll want to use the Autumn Statement to be seen to be making decisions that will directly appeal to the wider public, whilst ensuring that the UK remains a competitive marketplace and ‘open for business’.

“This is an important Autumn Statement for the Chancellor, so important in fact that he delayed it so the Prime Minister can be back in the UK when it’s delivered.

“There’s real pressure here to deliver what the voting public wants as well as ensuring a fair burden of taxes on large corporates and individuals.

“I think that this ‘striking a balance’ theme will feature throughout his speech on Thursday.”

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.