It was announced in the Budget 2018 that the government was introducing a new Structures and Buildings Allowance ("SBA") for costs incurred in relation to the construction, conversion, and/or renovation of non-residential structures and buildings. Effective from 29 October 2018, the SBA is available on the construction, conversion, and/or renovation costs relating to non-residential structures located in the UK or overseas. Please note that the SBA is only available for projects where the contract was entered into on or after 29 October 2018. The SBA is given at an annual rate of 2% on a straight-line basis for a fixed 50-year period from the date the structure comes into use.  Interestingly, there will not be a system of balancing ...

Here are some of the highlights from the Chancellor of the Exchequer's 2018 Budget (published on 29 October 2018): Personal Tax The Personal Allowance will be raised to £12,500 and the Higher Rate Threshold (i.e. the amount that an individual can earn before paying higher rate tax) to £50,000 in April 2019 – a year earlier than planned. These levels will remain the same in 2020/21, and then increase by CPI going forward. The final exemption period for Principal Private Residence Relief (PPR) which provides Capital Gains Tax relief on the sale of your home will be reduced from 18 to 9 months. Under the current PPR rules, where you have let a property which at one point was your home Lettings Relief may be available to reduc...

The Confederation of British Industry ("CBI") has submitted its recommendations to the Treasury on how to tackle the UK's skills shortage and encourage productivity and investment in business. After highlighting that the UK has the lowest level of business investment as a proportion of GDP in the G7, the CBI asked the Chancellor to use to Budget to assure businesses that the Government is committed to taking action to boosting UK competitiveness. A selection of the CBI's key demands have been provided below. 1. Capital Allowances The CBI has recommended that the Annual Investment Allowance ("AIA") for capital allowances is increased to £500,000 for two years to boost innovation and UK competitiveness. It is thought that this i...

The Office of Tax Simplification (the "OTS") has concluded its review on whether depreciation should replace capital allowances ("CAs") for tax purposes, and has found that whilst deductions for depreciation would simplify the system and more accurately reflect the underlying cost of assets, this would not outweigh the disruption such a change would cause. Background Under the current rules, a business recognises the reduced value of an asset in its accounts by including deductions for depreciation. Furthermore, deductions are made to account for the purchase of new capital assets. However, when calculating its taxable profits, the business is required to add back expenditure incurred on the acquisition of assets and any depreciat...

The sale of assets/property by a company is a deceptively complex area, and there are a number of issues and reliefs that must be considered to ensure that the corporation tax payable on the capital gain is correct. Sale of Asset – General Deductions In determining the capital gain on the disposal of an asset (most commonly property), a deduction can be made in respect of the following: Base cost/Acquisition cost; Incidental costs of acquisition and disposal, e.g. professional fees, advertising costs, and valuations; Costs incurred that increase the capital value of an asset (known as “Enhancement Expenditure”), e.g. costs of building an extension Capital Allowances On the purchase of property/assets by a compan...

The First-Tier Tribunal has held that a caravan purchased and used by an employee to enable him to perform his duties does not qualify as being plant or machinery for capital allowances because it failed the ‘necessity’ test outlined in CAA 2001 s36(1). However the Tribunal did find that the caravan was necessarily for the performance of the employee’s duties and therefore, were the employer to provide the accommodation to the employee for the purposes of the employee’s work, this would be exempt from tax. The Facts The Caravan Club Ltd (CCL) was involved in the management and upkeep of caravan sites across the UK. Mr Telfer (the taxpayer) was employed by CCL as an assistant warden and was required under the terms o...

Click here to download Issue 5, 2016 of the Intelligent Tax Newsletter. This issue provides a summary of the new 'Persons with Significant Control' reporting obligations, ways to facilitate a management buyout, and Making Tax Digital.

Here is a summary of some of the changes announced by the Chancellor of the Exchequer in the Summer Budget, published on 8 July 2015. Income Tax It is the government's objective to raise the personal allowance to £12,500 and the point at which high rate tax applies to £50,000 by the end of Parliament. Therefore, someone working 30 hours a week on the minimum wage (aged 21 or over) will not pay tax. The government will achieve this by: Increasing the person allowance from £10,600 for 2015/16 to £11,000 for 2016/17, and £11,200 for 2017/18 Increasing the basic rate band from £31785 in 2015/16 to £32,000 for 2016/17, and £32,400 for 2017/18. There has been an increase in the tax-free "rent-a-room" income from £4,250 to £7,500 ...

Click here to download the Spring 2015 edition of the Intelligent Tax Newsletter We have included a roundup of some intelligent ways to help you make the most of tax reliefs and save you money. In this issue: Entrepreneurs' Relief Capital Allowances: Integral Features Mobile Phones & Computers as Benefits in Kind  

We present a list of some changes and points of interest for the tax year commencing 6 April 2015 The threshold of turnover for VAT registration is now £82,000 The main rate of corporation tax is now in line with the small company's rate, 20%.  Therefore the marginal rate of corporation tax is 20% The personal allowance for income tax is £10,600 Earnings above £8,060 per year will attract National Insurance Marriage Allowance comes into effect.  Spouse can transfer £1,060 of unused personal allowance to a basic rate taxpayer spouse Significant changes come into effect for pensions and their accessibility (subject to the terms of your pension scheme) The annual allowance for pension contributions remains at £40,000 The A...