increase from £50,000 to £60,000. A new charge of £90,000 will be introduced for people who have been UK resident for 17 of the last 20 years. The government will also consult on making the election apply for a minimum of 3 years.
Restricting entitlement to the personal allowance for non-residents
At Budget 2014 the government launched a consultation on whether or not to restrict the Income Tax personal allowance for non-residents. Whilst the government believes there is a strong rationale for doing this, it recognises it is a complex change for both employers and individuals who may be affected. The government will continue to discuss implementation of this change with stakeholders. Should the government decide to proceed; a more detailed consultation will be undertaken. No change will come into effect before April 2017.
Individual Savings Accounts (ISAs): transfer to spouses on death
The government will legislate to allow an additional ISA allowance for spouses or civil partners when an ISA saver dies, equal to the value of that saver’s ISA holdings on their date of death.
ISAs: new annual subscription limits
The government will uprate the ISA, Junior ISA and Child Trust Fund annual subscription limits in line with the Consumer Price Index (CPI). The 2015-16 ISA limit will be increased to £15,240. The Junior ISA and Child Trust Fund limits will both be increased to £4,080.
55% tax charge on inherited pensions
From April 2015, beneficiaries of individuals who die under the age of 75 with remaining uncrystallised or drawdown defined contribution pension funds, or with a joint life or guaranteed term annuity, will be able to receive any future payments from such policies tax free where no payments have been made to the beneficiary before 6 April 2015. The tax rules will also be changed to allow joint life annuities to be paid to any beneficiary. Where the individual was over 75, the beneficiary will pay the marginal rate of Income Tax, or 45% if the funds are taken as a lump sum payment. Lump sum payments will be charged at the beneficiary’s marginal rate from 2016-17.
Small Business Rate Relief (SBRR)
The government will extend the doubling of SBRR for a further year from 1 April 2015.
Support for mid-sized businesses
HMRC is testing a new approach to supporting mid-sized businesses for launch in 2015. A new mid-size business unit will provide a gateway to the specialist tax help needed by mid- size businesses, including temporary access to a named individual for mid-size businesses transitioning through a key business change with significant tax implications. HMRC is also piloting a new model to support the fastest growing businesses. CIPP comment For many years small and medium sized businesses have expressed their disappointment that they do not have account managers, unlike large businesses. Whilst this pilot doesn’t go all the way to offering the same as a large business, it is heading in the right direction to support medium sized businesses.
Autumn Statement: What is the impact on flexible benefits and salary sacrifice?
5 December 2014
CIPP Policy News Journal
08/04/2015, Page 36 of 521
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