With the Autumn Statement just days away, the tax specialists at Baker Tilly have revealed what they think will be George Osborne's big changes.
1. Investment management and related services
Baker Tilly expects a clarification of the rules and for HM Revenue & Customs (HMRC) to issue guidelines on what VAT liability there is and where it applies.
2. A cap on income tax reliefs
This would typically hit high earners who benefit from, for example, share loss reliefs and property loss reliefs.
3. A reduction of the annual allowance for pension contributions
Currently the annual allowance is £50,000 a year. This could be reduced to £40,000 a year, which would save the Treasury about £600m each year, or even £30,000. The total amount you can put in a pension pot has already been cut from £1.8m to £1.5m.
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4. Inheritance tax
A simplification of charges on trusts
5. Main residence relief
According to Baker Tilly, HMRC has received a lot of queries about this relief, mainly along the lines of boundaries - with size of total property and land a qualifier of the relief.
6. IHT and transfers to non-dom spouse
This has been at a £55,000 limit for some years and could be increased.
7. Business Investment Relief
Baker Tilly said this could be extended to LLPs.
8. VAT reduced rate
Some items attract VAT at a rate lower than the standard rate of 20% - the items on the reduced rate list could increase.
9. A new annual charge and capital gains tax charge on ‘enveloped' residential properties
Enveloped properties are those held by a corporate entity like a company - Baker Tilly thinks they could be subject to new charges as a way of getting a mansion tax in through the back door.
10. Widening out of the tax relief for the creative sector
From just tax relief on films to also include relief on TV programmes and computer games which are "culturally British".
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