Autumn Budget 2017: What you need to know

Autumn Budget Summary - Green & Co

Yesterday, the Chancellor announced his second Budget of 2017. Among the key changes to note for this year are:

  • The personal allowance will rise to £11,850 and the higher rate tax threshold for the UK will rise to £46,350 for 2018/19.
  • Automatic enrolment pension minimum contributions increase significantly from 6 April 2018. Employer’s minimum contribution will increase from 1% to 2% with the total minimum contribution increasing to 5% (including 3% staff contribution).
  • The inheritance tax residence nil rate band rises to £125,000 from 6 April 2018.
  • Half of any interest tax relief for personal buy-to-let borrowing will be limited to a 20% tax credit from 2018/19.
  • The VAT threshold will be frozen at £85,000 until March 2020.
  • The diesel supplement for company cars will be increased from 3% to 4% from April 2018.
  • The First time buyers of residential property outside Scotland will pay no stamp duty land tax on the first £300,000 of the purchase price for a home, provided its value does not exceed £500,000.

Download our budget summary to see the rest of the changes announced by Mr Hammond.

If you have any questions about the summary’s contents or how any aspects of your tax and financial planning may be affected by the Budget, please contact us to discuss them.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

2017 Budget Review

Following on from the Chancellor’s first and last Spring Budget, we are pleased to provide you with our summary of the key announcements, along with our tax tables for the 2017/18 tax year:

Budget Summary

Tax Data
The main changes include:

  • The tax-free dividend allowance will be reduced from £5,000 to £2,000 from April 2018.
  • Class 4 national insurance contributions for self-employed workers will increase to 10% in April 2018 and rise again, to 11%, from April 2019.
  • Unincorporated businesses and landlords with a turnover below the VAT threshold will have until April 2019 before they are required to implement ‘Making Tax Digital’.

Among the key changes to note for this year are:

  • The Chancellor confirmed that corporation tax will be cut to a rate of 19% from April 2017 and it will be further reduced to 17% in 2020.
  • The personal allowance will rise to £11,500 in April 2017 and to £12,500 by 2020 and the higher rate income threshold will rise to £45,000, although special rules will apply in Scotland.
  • Individual landlords’ tax relief for finance costs will be restricted to basic rate tax – to be phased in over four years from April 2017.

More information on the Budget is available on our website or if you would like to speak to one of our team please contact us.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

Are you aware that you have to charge VAT for storage space?

The introduction of VAT on self-storage in October 2012 is still having ramifications! As the legislation referred to self-storage, it was not fully understood what impact it would have on other trade sectors.  Although the legislation was termed self-storage, HMRC defined the granting of facilities to a person, for the storage by them of goods, or a storage facility which is empty, as standard rated – facilities being understood as a unit, container or building.

In August 2013, HMRC issued a VAT information sheet (10/13) (click here to view) which cancels the sheet on self-storage and is now named “Provision of Storage Facilities”.  This notice clarifies that there is no difference between “storage” and the term “self-storage”.  Therefore, if you let space for storage you have to charge VAT!

You must also account for any VAT due under the changes in law that took place with effect from 1 October 2012 whether or not you have charged an amount of VAT to your customer. You may be able to charge the VAT to your customer retrospectively and many contracts make provision for this.

The other implication of VAT on storage is that if you are not VAT registered or have a business which has previously traded under the VAT threshold (presently £79,000), you might find yourself in the situation where you now have to register for VAT.

If you would like VAT-related advice specific to your business, please contact us.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.