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The annual investment allowance will remain at £200,000 for 2018/19 and 2019/20. The main rate and special rate writing down allowance on plant and machinery will be 18% and 8%, respectively.
The 100% first-year allowance for businesses purchasing zero-emission goods vehicles or gas refuelling equipment will be extended for a further 3 years.
For zero-emissions goods vehicles, the scheme will end on 31 March 2021 for corporation tax and 5 April 2021 for income tax.
For gas refuelling equipment, the scheme will end on 31 March 2021 for both corporation tax and income tax.
The list of technologies and products covered by the energy saving first-year allowances has been updated. It adds 3 new products, which include evaporative air coolers, saturated steam to electricity conversions and white LED lighting modules to the list. The measure also modifies 9 and removes 2 items from the list.
The scheme allows 100% of the cost of an investment in qualifying plant and machinery to be written off against the taxable income of the period in which the investment was made.
From 1 January 2018, the rate of tax relief available to companies that carry out qualifying R&D and claim the research and development expenditure credit (RDEC) will increase from 11% to 12%.
The RDEC is a standalone and above the line credit that is brought into account as a receipt in calculating profits, which allows companies to claim an enhanced corporation tax deduction or payable credit on their R&D costs.
From 6 April 2018, the van benefit charge will increase from £3,230 to £3,350 and the van fuel benefit charge will increase from £610 to £633.
Employees provided with fuel for private mileage in a company car will see the value of the multiplier used for calculating the cash equivalent of the fuel benefit increase from £22,600 to £23,400. This measure will apply on and after 6 April 2018.
The diesel supplement used to calculate the company car benefit and company car fuel benefit will increase from 3% to 4% for all diesels cars registered on or after 1 January 1998 that do not meet real driving emissions step two standards.
The maximum appropriate percentage applied for cars, including any diesel supplement, will remain at 37%.
The annual chargeable amounts for the annual tax on enveloped dwellings (ATED) will increase in line with inflation for the 2018/19 chargeable period, which begins on 1 April 2018.
The increase will see the annual chargeable amount for a property with a value in the range of £500,001 to £1m rise from £3,500 a year to £3,600 a year.
The main rate of corporation tax will remain at 19% from 1 April 2018.
For a capital gain made on or after 1 January 2018, the indexation allowance which is applied in order to determine the amount of the chargeable gain will only be calculated up to December 2017.
This change means that for disposals made after this date, the indexation will no longer be calculated up to the month in which the disposal of the asset occurs.
The corporate interest restriction rules for large companies which incur net interest expense and other financing costs above £2m a year will be amended.
A number of technical changes will be made, with some having effect from 1 April 2017 when the corporate interest relief restriction rules commenced. The remainder will have effect from 1 January 2018.
Some of these measures include amendments to:
The purpose of the policy is to ensure that relief for foreign tax is only given where profits have been taxed both in the UK and the foreign jurisdiction.
The measure will have effect for accounting periods ended on or after 22 November 2017 with a transitional rule applying for accounting periods that straddle 22 November 2017.
A variety of other complex corporation tax changes were introduced which legislate to ensure:
To provide more clarity over aspects of the taxation of partnerships, a number of measures have been proposed, affecting:
The purpose of the legislation is to ensure individuals who effectively work as employees, but structure their work through a company, are taxed as employees.
The consultation will explore the possibility of extending the recent public sector reforms to the private sector.
The government will not extend disincorporation relief beyond the current 31 March 2018 expiry date.
Employer-provided electricity at workplace charging points for electric and hybrid cars owned by employees will be exempt from being taxed as a benefit in kind from April 2018.
From 6 April 2018, the government will allow employees on maternity and parental leave to take a pause of up to 12 months from saving into their save-as-you-earn employee share scheme, which is an increase from the current limit of 6 months.
With effect from April 2019, employers will no longer be required to check receipts when making payments to employees for subsistence using benchmark scale rates.
Employers will still be required to ensure employees are undertaking qualifying business travel.
Major reforms were announced to business rates worth approximately £9bn by the end of this parliament. There are a number of measures, which include:
From April 2019, withholding tax obligations will be extended to royalty payments, and payments of certain other rights, made to low or no tax jurisdictions in connection with sales to UK customers. This measure will apply regardless of where the payer is located.
A series of measures are announced which are intended to ensure that tax-advantaged venture capital trusts (VCTs) continue to focus on long-term investment in higher-risk companies.
These measures change certain rules on investments made by VCTs that will:
The definition of a ‘relevant investment' is amended to ensure that all investments, including all risk finance investments made before 2012, are counted towards the lifetime funding limit for companies receiving investment under tax advantaged venture capital schemes.
The limit is £12m for most companies and £20m for knowledge-intensive companies.
This measure will affect companies, social enterprises, fund managers and individuals using the enterprise investment scheme (EIS), VCTs and social investment tax relief. The changes will apply to qualifying investments made on or after 1 December 2017.
Contact us to discuss how Autumn Budget 2017 may affect you.