Autumn Statement: Key Points for Individuals and SMEs
Earlier today George Osborne, Chancellor of the Exchequer, delivered his Autumn Statement to Parliament.
Following are a summary of the key points affecting both SME business owners and individuals, taken from today's statement.
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Automatic Information Exchange Agreed for Offshore Disclosure Facilities
Earlier this year, Offshore Disclosure Facilities (ODF) were agreed between the UK government and the governments of Jersey, Guernsey, and the Isle of Man, designed to last between April of this year and 30 September 2016. During this period Financial Intermediaries in these three dependent territories are to be contacting people who they believe may be eligible to participate in the facility.
In the latest update to these agreements in October this year, the governments have now agreed to an automatic and spontaneous exchange of information between the UK and the relevant offshore government, from 2016 onwards.
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SEIS Investment Injects £82m Into Start-Ups
The SEIS (Seed Enterprise Investment Scheme), put forward by Chancellor George Osborne in 2011 and formally launched in April 2012, is designed to help small, early-stage or start up companies raise equity finance by encouraging individual investors with the prospect of receiving 50% of their investment back as income tax relief.
In the eighteen months since its introduction, over 1,100 companies across the UK have raised over £82 million in funding through SEIS investment, with the average amount of investment being raised currently at £72,000, according to HMRC.
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How The Cap on Income Tax Reliefs Affects You
Last year the Chancellor announced the government was intending to introduce a cap on currently unlimited income tax reliefs, due to take effect from the tax year 2013-14. This cap has now been put into place, with HMRC having since published guidance on the new rules.
The cap has been set at either £50,000, or 25% of your adjusted total income for the current tax year (whichever is the greater number).
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What The New Flat Rate State Pension Means for You
The government has proposed the introduction of a simple, single-tier flat rate state pension in the hope of removing complex elements out of the current State Pension system and encouraging a greater number of people to save for retirement.
According to The Department for Work and Pensions, in the new system – which incorporates a merger of the basic state pension with the state second pension – the single-tier pension is expected to be worth approximately £145.40 per week for a single pensioner, compared to the current state pension of £110.00 per week (alongside means-tested top-ups).
The Pensions Bill, which contains the provisions to bring forward the flat rate state pension as part of the State Pension system, was introduced to the House of Commons in May of this year, and is currently going through parliament.
What is the UK and Swiss Tax Cooperation Agreement?
With the HMRC having recently sent out their first batch of warning letters to Swiss Account Holders, I though it may be useful to recap the details of the UK and Swiss Tax Cooperation Agreement.
The new information-sharing agreement was made between UK and Switzerland and came into force on 1 January 2013. The agreement covers undeclared Swiss bank accounts held by UK residents. This agreement changes the way that banking will be conducted in Switzerland and the information sharing enables HMRC to find out about Swiss offshore accounts held by UK taxpayers.
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HMRC warning letters to Swiss Account Holders
HM Revenue and Customs (HMRC) recently sent out their first batch of 6,500 warning letters to UK holders of Swiss bank accounts. These warning letters, sent at the end of September, advised Swiss account holders that they have a six week deadline to ensure they are compliant with the new UK tax laws which came into effect in January 2013.
Affected taxpayers are advised to consider using the Liechtenstein Disclosure Facility to bring their tax affairs to order.
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Small business owners get £2,000 Employment Allowance Tax cut
The Employment Allowance tax cut will give businesses and charities up to £2’000 a year tax saving.
The planned tax cut will be introduced from April 2014 through the National Insurance Contributions Bill and is expected to benefit more than 1.2 million small businesses in UK. The aim of the Employment Allowance is to assist small businesses to grow by supporting the cost of employment. When this new regulation comes into force, it will result in approximately 450,000 businesses not needing to pay National Insurance Contributions at all.
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Health and Wellbeing Tax Plan | A new campaign for tax defaulters
The latest campaign from HMRC, the Health and Wellbeing Tax Plan, launched on 7 October 2013 and will run until 6 April 2014.
The Health and Wellbeing Tax Plan is a new campaign for tax defaulters, aimed at those who work in the health and wellbeing sector, including alternative medicine or therapy. It and is designed to encourage voluntary disclosure of income or gains that have not yet been declared to HMRC, allowing health and wellbeing professionals to bring their tax affairs up to date.
New tax break for married couples
If you are married or in a civil partnership, you may be able to benefit from the new tax break for married couples announced last week – a transferable tax allowance for married couples.
This new tax break will come into effect from April 2015 and will allow one individual to transfer a fixed amount of their personal allowance to their spouse or civil partner. The transferable tax allowance will only be available to couples where neither of the partners is a higher rate taxpayer.
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