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Autumn Statement

George Osborne delivered his Autumn Statement last Thursday. He was keen to announce that the government’s economic plan was working, that growth is higher than expected and consequently borrowing was less than forecast. Whether you agree with his analysis may depend upoan your politics but very few people I have spoken to expect their financial position to improve in the near future.

There had been some speculation about pre-election tax giveaways but the chancellor has decided not to change course. Consequently there will be more cuts to public spending and relatively few changes to tax legislation.

The main highlights were –

* The personal allowance will increase to £10,000 in 2014/15. The income tax higher rate (40%) tax threshold will increase by £415 to £41,865.

*The introduction of a transferable tax allowance of £1,000 for married couples and civil partners from April 2015. This can potentially save £200 tax where one partner earns less than the basic personal allowance, provided the recipient of the transfer does not pay income tax above the basic rate.

* From 6 April 2015 employers will no longer pay Class 1 national insurance contributions on earnings paid up to the upper earnings limit to any employee under the age of 21.

* In October 2015 a new class of voluntary NICs (3A) will be introduced to allow pensioners who reach state pension age before 6 April 2016 to top up their Additional Pension entitlement.

* ISA subscription limits for 2014/15 will rise to £11,880, of which £5,940 can be invested in cash.

*The Capital Gains private residence relief final exemption period prior to sale will be halved to 18 months from April 2014.

* From April 2015, capital gains tax will apply to future gains on residential property owned by non-resident individuals. This brings them into line with UK residents who had to pay capital gains tax on such gains.

* The small company rates relief is extended to April 2015. Increases in business rates are capped to 2% for properties not eligible to the small business relief.

* The investment limits for share incentive plans are increased to £3,600 for “free shares”.

* Increases in the age for receiving the state retirement pension

* Cancellation of the planned fuel duty rise

* Amendments to anti-avoidance legislation to block the growth of intermediaries disguising employment income as self-employment.

It is very unlikely that all these announcements will apply to you, but if you have any questions I would be happy to discuss them with you. Please call 01455 557270.

Howell & Co has been assisting Online Profiling Ltd since 2005. They couple efficient service with good practical advice and are always extremely helpful and professional.  
Trevor DawesManaging DirectorOnline Profiling Ltd

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