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Autumn Budget 2017

Autumn Budget 2017

Wednesday 22nd November 2017

Did the Chancellor forget to read a page in his speech?

The Chancellor of the Exchequer, Philip Hammond, today presented the first Autumn Budget. His speech was notable in only mentioning income tax three times, one of which was tangential.

We were told the amounts by which the personal allowance and the 40% higher rate threshold will increase. Both measures are of academic interest only to individuals with sufficient income to trigger the 45% additional rate. We also heard that the Enterprise Investment Scheme was to be enhanced, but only for knowledge intensive projects.

As is usual, once the Chancellor had concluded his speech, the government issued a series of publications. The general idea behind this process is to add some flesh to the bare bones of what the Chancellor has announced. It is not unknown for this material to contain the odd ‘surprise’ of something that the Chancellor did not mention in his speech. However, from the number of such things turning up in today’s post-Budget publications, one is left wondering if the Chancellor either mislaid a page of his speech or two pages accidentally stuck together.

Here is a short list of those proposals which are likely to be of interest to internationally mobile individuals.

Carried Interests
The receipt of carried interest forms part of the remuneration structure of managers in the funds industry. Capital Gains Tax changes, which became effective in July 2015, were accompanied by transitional rule. Those transitional provisions will no longer be available for carried interest awarded after 22 November 2017.

New anti-avoidance rules for offshore trusts benefiting UK resident individuals. Small modifications to draft legislation published in September.

A consultation is to be published in 2018 on how to make the taxation of trusts “simpler, fairer and more transparent”.

Employment Income – Termination Payments
Effective for employments terminated on or after 6 April 2018, rules first proposed in the 2016 Budget. Foreign service relief will no longer be available, other than for seafarers.

Capital Gains Tax (CGT)
Historically, CGT has only been levied on UK residents. A recent exception to that basis was the charging to CGT of gains arising on UK residential property. Such gains are now taxable when made by non-residents of the UK.

A consultation has been published on extending the scope of CGT to gains made by non-residents on UK immovable property in general. If enacted, this proposal would bring disposals of UK commercial property by a non-resident within the charge to CGT.

Certificates of Tax Deposit
It will not be possible to purchase new Certificates of Tax Deposit after 22 November 2017.

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