Review of the 2014 Autumn Statement
04 December 2014 •
In his 2014 Autumn Statement the Chancellor announced a number of significant changes. Here is our initial reaction to these changes, as well as an overview of some of the key points that could affect you and your business.
Stamp Duty Land Tax
This was one of the key changes announced in the Chancellor’s Autumn Statement and the changes are anticipated to deliver savings for up to 98% of the house purchasing public. Rather than a stepped method of calculating Stamp Duty Land Tax on acquisitions of residential property, from 4th December 2014, this will change as follows:
| Property Value (£) |
Tax rate charged on part of property price within each tax band (%) |
| 0 – 125,000 |
0 |
| 125,001 – 250,000 |
2 |
| 250,001 – 925,000 |
5 |
| 925,001 – 1,500,000 |
10 |
| 1,500,001+ |
12 |
Broadly, the new calculation mechanism means a lower SDLT charge on values up to £937,500, but a higher charge for property purchase above this value.
Entrepreneur’s Relief Changes
Changes have been announced to the availability of Entrepreneur’s Relief on the incorporation of sole trader and partnership businesses into Limited companies. From the 3rd December 2014 Entrepreneur’s Relief will no longer be available on the transfer of good will between these connected parties and no corporation tax deduction is available within the company for the amortisation of this acquired goodwill for the company.
ISA Transfers
The Chancellor announced that he will now allow for ISAs to be transferred to surviving spouses on death of an individual and retain the tax benefits of the ISA “wrapper”.
Pension Transfers
As previously announced the onerous 55% tax charge payable by pension schemes on transfer at death has been abolished. Now surviving family members can receive these pension funds free of tax.
Remittance Basis charge
A new rate for UK resident/non-domiciled individuals utilising the remittance basis has been announced. Individuals who have been a UK resident for more than 17 of the last 20 years will now incur a £90,000 remittance basis charge if they wish to utilise the remittance basis.
In addition, the £50,000 remittance basis charge which is incurred by UK resident/ non-domiciles who have been resident in the UK for more than 12 years has been increased to £60,000.
If you would like to talk to one of our tax team and explore what this Autumn Statement could mean for you and your business, please call 020 7731 6163
No responsibility for loss occasioned to any person acting on or refraining from action as a result of the material in this email can be accepted by us.