Weekly tax brief 9 March 2017

In this edition of RSM’s weekly round-up of the most important tax news, we cover the latest developments.

Spring Budget 2017 – what should I do now?

09 March 2017

It would be deceptively easy to dismiss the tax impact of Philip Hammond’s first and last March Budget statement. Containing only 14 new tax measures, and running to a relatively slender 64 pages, hardened Budget commentators might regard it as lightweight. But that would be to disregard the scale and nature of some of the changes.

Dividend dis-allowance

09 March 2017

The £5,000 tax-free dividend allowance was introduced in the first Budget of the new Conservative government in summer 2015. This, we were told, would create a ‘simpler system’ which would mean only those with significant dividend income would pay more tax. Now, less than two years later, it seems that we will have a more complex system and those with modest income from shares will see a rise in the amount of tax they owe. Two years is clearly a long time in politics.

A ‘fair’ Budget?

09 March 2017

The Chancellor was at great pains to stress that he wanted to create a ‘fair’ tax system, but ‘fair’ is one of those loaded words which depends on where you are standing. So what does Mr Hammond mean when he talks about fairness?

Just one month until income tax divergence in Scotland

09 March 2017

From 6 April the full impact of devolved income tax in Scotland will be felt for the first time. The higher rate threshold will be frozen at £43,000 in Scotland while increasing to £45,000 in the rest of the UK. Scottish taxpayers will be faced with higher tax bills where they have earnings, pension and rental income in that range.

Taxing online sales the VAT split payment model

09 March 2017

In its drive to stamp out VAT evasion and avoidance by businesses selling goods to UK consumers via online marketplaces, the government has announced its intention for HMRC to be able to extract VAT directly from transactions at the point of purchase. Whilst there is little doubt that the proposed split-payment mechanism will close VAT loopholes, it may cause some controversy, particularly if it is likely to impact business with a UK supply chain.