Publication of the Finance Bill and forthcoming Consultations

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On 29 March 2012, the Government published the Finance Bill, which will enact tax measures announced in the Spring Budget.

The progress of the Finance Bill through Parliament can be seen here.

Key highlights from the Bill include the following:

  • reducing the additional rate of income tax to 45%; from April 2013
  • broadening the tax base while simplifying the tax system;
  • tackling over £1bn of tax avoidance and evasion;
  • and cutting the corporation tax rate to 24% this year and 23% in 2013

A timetable has also been published detailing the proposed dates of various consultations regarding proposed legislative amendments. These include the following:

April

• Changes to IR35

Relating to proposals which would require office holders / controlling persons who are integral to the running of an organisation, to have PAYE and NICs deducted at source.

May

• Disclosure of Tax Avoidance Schemes (DoTAS)

Relating to proposals which will extend the DOTAS hallmarks so as to capture avoidance schemes that do not currently have to be notified. We expect further details to be released in due course.

• Inheritance Tax (IHT)

HMRC propose to simplify the calculation of IHT on periodic and exit charges for trusts.

• Sub-sale relief for Stamp Duty Land Tax

Further to a measure, effective from 21 March 2012, denying sub-sale treatment to arrangements involving options, HMRC are proposing consultation regarding the broad approach to addressing SDLT sub-sale avoidance. Our comments relating to this can be seen here.

June

• The General Anti-Avoidance Rule (GAAR)

Consultation regarding new draft legislation to introduce a general anti-aviodance rule to have effect from April 2013. Suffice to say, we intend to have our say as part of this consultation process and we will be asking for your thoughts and views before submitting our response. Our comments in relation to this can be seen here.

Later in 2012

• Cap on tax reliefs (with effect from April 2013)

Consultation on how the cap will be operated. The Government will explore with philanthropists ways to ensure that this policy will not impact significantly on charities that depend on large donations. The proposed measures may be seen here.

5 April 2012

Who to contact?

For more information contact Paul Merrell on 0115 983 5586 or e-mail at pmerrell@edftax.co.uk.