On 5 December 2012, the Chancellor of the Exchequer delivered the Autumn Statement to Parliament. The Autumn Statement contains an indication of proposed legislation for the Budget of 2013 and subsequent years.
The main tax proposals are set out below.
The basic personal allowance for 2013-14 will be increased to GBP 9,440.
The basic rate limit will be decreased to GBP 32,010.
There will be a reduction in the amount of tax relief for pension savings. The annual allowance will be reduced from GBP 50,000 to GBP 40,000. The standard lifetime allowance will be reduced from GBP 1.5 million to GBP 1.25 million. In respect of the latter change, transitional rules will ensure protection for taxpayers who may be affected by the reduction.
The main rate of corporation tax (currently 24%) will be reduced to 23% for financial year 2013.
For financial year 2014, the main rate of corporation tax will be reduced to 21%.
With effect for a 2-year period commencing on 1 January 2013, the Annual Investment Allowance will be increased from GBP 25,000 to GBP 250,000 per annum. Under the Annual Investment Allowance rules, qualifying capital expenditure is eligible for full deduction rather than being written down on an annual basis under the capital allowances rules.
A simplified income tax scheme for small unincorporated businesses will be introduced in 2013-14.
Anti-avoidance rules have been drawn up, dealing with the following:
- foreign bank levies;
- tax mismatch schemes involving asymmetric tax treatment of loans or derivatives;
- property return swaps;
- manufactured payments; and
- payment of patent royalties.
let's work together