Ahead of the Autumn Budget 2018, Blick Rothenberg partners Heather Self, Nimesh Shah, Fiona Fernie and Andrew Sanford look ahead to what the Chancellor could, should and shouldn't announce with regard to corporation tax, anti-avoidance and evasion, Capital Gains Tax, taxing digital businesses and employment tax.
Anti-avoidance and evasion
- Corporation tax could see a further reduction to 15% as the UK strives to remain attractive to businesses, both domestically and internationally. It is already confirmed to reduce to 17% from 1 April 2020. Nimesh Shah, Partner
Capital Gains Tax
- The Chancellor should stop and take stock before announcing any further measures in relation to combating tax evasion or avoidance. Over the last few years HM Revenue & Customs ("HMRC") have been given wider and wider powers and there has been no time for individuals and businesses to adjust to one measure before the next has been announced. Since the Economic Affairs Finance Bill Sub-Committee (Lords) is currently reviewing those powers to ensure that they are both fit for purpose and being used appropriately, this is not the time to 'move the goalposts' again. Fiona Fernie, Partner
Taxing digital businesses
- The Government will need to raise cash for social care. Tax will need to be raised to cover this. Entrepreneurs’ relief may be targeted on Capital Gain Tax, by reducing the threshold from £10,000,000 to a lower amount. This would be concerning to many entrepreneurs and may act as a disincentive for further expansion. Andrew Sanford, Partner
- Any attempt to levy a new tax on major digital businesses will be fraught with difficulty. The Chancellor should resist the political pressure and continue to work on an international basis to achieve longer-lasting solutions. Heather Self, Partner
- The Chancellor decided not to abolish Class 2 NICs, setting the scene for increases in NIC - perhaps particularly on the self-employed - in this Budget. Expect some significant rises, perhaps especially for partners in large professional firms who could be required to do their bit to fund the NHS. Heather Self, Partner
- The apprentice levy will be reformed, so that funding becomes more easily available to employers as the requirements for training are relaxed to allow more 'on the job training'. Andrew Sanford, Partner
Blick Rothenberg will be producing commentary and analysis in the lead up and on the day of the Budget announcement on Monday 29 October, please visit our Autumn Budget 2018 page for the latest updates.
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