“It is great to see the Chancellor embracing technology in his desire to create “the most digitally advanced tax administration in the world”. There was an immediate sting in the tail however in the form of payments on account for capital gains on residential properties. Worryingly, this sounds like an idea which will catch on and may soon cover capital gains on a wider category of assets.”
Erika Jupe, Head of UK Corporate Tax, Osborne Clarke LLP
“From a private client perspective, the introduction of an obligation to pay CGT on residential property disposals within 30 days (albeit from 2019) and the additional 3% SDLT payable on the acquisition of “additional properties” were the biggest surprises. Of most concern was the announcement of a 60% civil penalty for avoidance countered by GAAR – which appears a little unfair when the GAAR rules make no provision for prior rulings. Advisers will have to take an extremely conservative approach to the GAAR guidance notes from April 2016.”
Andrew Goodman, Partner, Private Client, Osborne Clarke LLP
“In his speech, the Chancellor announced that the government would take “action on disguised remuneration schemes”. The supporting documents published by HM Treasury make it clear that the government will consider legislating to close down any further new schemes intended to avoid tax on earned income, where necessary, with effect from 25 November 2015. It is not clear which specific arrangements are under HMRC’s scrutiny, but legislation to tackle them may well be included in future Finance Bills.
We await the promised legislation which is intended to “streamline and simplify aspects of the tax rules” for both tax-advantaged and unapproved share plans. Clarity of the treatment of employment-related securities and options held by internationally mobile employees is to be welcomed.
Salary sacrifice arrangements remain under the spotlight, with the government undertaking to obtain further evidence to inform its approach – it may be that a more substantive update can be provided at Budget 2016.”
Karen Cooper, Partner, Incentives, Osborne Clarke LLP
“Even though it was a relatively unremarkable Autumn Statement from a tax perspective, there were a few property tax announcements to note. A key announcement was that a higher rate of SDLT will be payable from 1 April 2016 on second homes and buy to let properties but corporates or funds making significant investments in residential property will fall outside of the new charge. This continues the Government’s attack on private landlords having already announced plans to restrict interest relief and to replace wear and tear allowances with a more restrictive relief.
The Government also clamped down on certain capital allowance schemes with effect from 25 November 2015.
Tracey Wright, Partner, Tax, Osborne Clarke LLP
“Following the Chancellor’s autumn statement, many in the pensions industry will heave a sigh of relief that pensions aren’t making the headlines. However, for the committed there are two notable developments that catch the eye. The first is the announcement that the next two increases in automatic enrolment will be deferred by 6 months. This will be welcomed by businesses across the land, large and small. The second is that we have been given much more on the Government’s plans for the creation of what it is calling “six British Wealth Funds”. With assets of at least £25 billion, these are the intended outcome of the proposals for investment pooling by the 90 or so funds in the Local Government Pension Scheme.
Beyond that, it is what was not said by the Chancellor which is interesting. He has not revealed his hand on potential reforms to the pensions tax relief regime (that will come at Budget 2016), nor has he given any indication yet of where the current scrutiny of salary sacrifice is leading. Also, the hopes of those seeking a U-turn on the new tapered annual allowance for higher earners were dashed. This remains a big development for pension funds and employers, which is now on the very near horizon.”
Mark Womersley, Partner, Pensions, Osborne Clarke LLP