Autumn Statement 2016

Autumn Statement 2016

With what is to all intents and purposes a new government, and one heavily pre-occupied with the impacts of Brexit, this might have been an Autumn Statement that was heavy on tax changes, but in the event, it turned out not to be. However Philip Hammond strongly advocated the benefits of productivity and efficiency, and there are signs that this will reflect in some streamlining of our arcane tax system.


Watch our insights on Autumn Statement 2016

With the government preoccupied with Brexit the last ever Autumn Statement was devoid of heavy tax changes. Instead, the Chancellor spoke strongly about the benefits of productivity and efficiency and gave a glimpse of a streamlined UK tax system. Our Head of Tax, Jim Meakin explains more. 
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Private individuals

The Autumn Statement was aimed at carrying out the Prime Minister’s commitment to helping the JAMs (those Just About Managing). Increases to the personal allowance and basic rate band will be welcomed by many, as will new national savings rates for modest cash sums currently earning low or no interest. For more complex, typically wealthier clients, with an international aspect to their affairs, the government is pushing ahead with rapid changes, effective in April 2017 and, disappointingly, have not taken the chance to delay rules and allow clients to reorganise their affairs.
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Private individuals
Companies

Companies

There haven’t been any surprises regarding corporation tax in this Autumn Statement, moreover a confirmation of the previous changes that have been announced and were already expected. This follows the stated theme of providing certainty for companies doing business in the UK. It seems a case of maintaining a steady ship, and perhaps saving a corporate tax rate cut, (where there had been rumours of a cut to 15 per cent) for a later date, should these be required in a post Brexit environment. Turning to the changes that were already announced and now confirmed, the interest deductibility rules and the loss relief changes will now be brought into effect from 1 April 2017.

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Employers

Major changes for employers coming into effect in April 2017. Following the earlier promises of his predecessor the Chancellor has set out clearly the direction of travel in relation to the taxation of employees. In aiming to tax employees on the true value of their benefits, he has delivered a Hammond blow to salary sacrifice schemes. These schemes are popular with employers and employees alike as it allows certain benefits to be taxed at a lower figure than the cash equivalent cost of the benefit. Employers also benefit as they pay less National Insurance.
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Employers
Sectors

Sectors

See our sector commentary here, including the announcement of the consultation to ban cold callers preying on those who are considering cashing in their pension pots.
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