On 29th October Philip Hammond delivered his final Autumn budget. The proposal being that going forward we will only have a Spring budget. As always, there is a lot of detail in the budget, but to summarise some of the main points that may affect you;
- Personal allowances increase from April 2019 to £12,500 and higher rate tax starting at £50,000. – Good news for many people.
- Annual Investment Allowance increased to £1m – Good news for medium / large businesses who would be looking to make investment into equipment etc.
- Entrepreneurs Relief minimum qualifying period extended to 2 years. – Not great news for serial entrepreneurs who buy and sell businesses in less than a year, but for many business owners, no direct impact.
- Restriction of payment of R&D tax relief – This measure means that any claim for payment of R&D tax credit will be limited to 3 times the company’s PAYE/NIC liability. This is a blow for small businesses carrying out R&D whilst not generating much income.
- IR35 – Rolling out IR35 into the private has been delayed until April 2020 (previously it had been suspected it would be April 2019) and even then only medium and large companies will be effected. It appears small companies have escaped this measure, at least for the time being.
- Reduction of allowances when selling rental properties – Yet another blow to landlords. The final period of principle private residence relief has been reduced further from 18 months to 9 and restrictions on the letting relief which was hugely valuable to landlords that had previously occupied their rental properties will mean from April 2020 CGT liabilities could increase by £11,200!
As always, there were many things announced in the budget, but I have attempted to list the ones that will be of interest to most people. If there are other headlines or budget announcements that you want to know the impact of, please give me a call on 01752 895648
– Simon Jilks, Director – Ivybridge Accountants Ltd