Backed by a number of better than expected economic statistics, the Chancellor managed to combine limiting the headline tax changes with some welcome announcements for certain areas of UK business. Notably this included a reduction in the administrative burden of the research and development tax credit system, the deferral of the digital tax system for small businesses and a reduction in the business rates increases.
The reduction in the dividend allowance from 2018 and the increase in national insurance rates for the self-employed in 2018 and 2019 has the feel of the start of a number of changes to align the taxation of the employed and self-employed.
The Chancellor promises to build an economy that “works for everyone” but is clearly not prepared to let the country spend more than it earns to deliver this. All expenditure is to be funded by the Budget changes, and further anti-avoidance provisions will provide a significant element of that funding.
Corporate and business taxes
- Business rate reductions
- Delay in making tax digital for small businesses and landlords
- Preventing abuse for transfers of trading stock
- Certain offshore property developers immediately brought into charge to UK tax
- Increase in class 4 national insurance rates effective from 2018 and 2019
- Reduction in dividend allowance from April 2018 to £2,000
- Consultation announced for different forms of remuneration, including benefits, expenses and accommodation
- Guidance to be issued on the taxation of image rights payments
- Changes to the registration and de-registration allowances
- Combating fraud in the provision of labour in the construction sector
- Delay of reduction in payment window for stamp duty land tax
- Soft drink levy rates confirmed at 18p and 24p per litre
- Tax charge introduced on transfers to certain overseas pension schemes
- Removal of the VAT use and enjoyment provisions for business to consumer mobile phone services
- Strengthening tax avoidance sanctions
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