News & Insights

Back to News & Insights Archive

Headlines from the Spring 2015 Budget

18th March 2015

The Chancellor delivered the last Budget of the current Parliament earlier this afternoon.

The key tax measures announced include:

  • Income Tax: Personal Allowance to increase to £11,000 by 2017
  • Income Tax: Higher Rate threshold to increase to £43,000 by 2017/18
  • Pensions: cut in lifetime allowance to £1m from £1.25m, from 2016
  • Pensions: lifetime allowance to be index-linked from 2018
  • Pensions: no cut in annual allowance, which remains at £40,000
  • Pensions: flexibility and lower tax rates for holders of existing annuities
  • Additional anti-avoidance, including: 
    • Recovery of VAT re foreign branches
    • Further Advance Payment Notices to be issued to investors in tax avoidance schemes
    • A clampdown on employment intermediaries and umbrella companies re travel and subsistence payments
    • Consultation on the use of deeds of variation for Inheritance Tax Planning
    • Diverted Profits Tax for large multinationals to come into effect in April 2015
    • Further details to be published on the proposed new criminal offence for tax evasion
    • Further details of penalties for advisers on tax avoidance schemes to be published
    • Corporation Tax rules to be changed to prevent contrived loss arrangements
  • Capital Gains Tax: a tightening of rules for Entrepreneurs’ Relief, which can reduce the tax rate to 10%
  • Enhancements to film, TV, and video game reliefs
  • Confirmation that orchestra tax relief will go ahead
  • Farmers averaging of income for tax purposes extended to 5 years (from 2 years)
  • Business rates: fundamental review announced
  • National Insurance: abolition for apprentices from 2016
  • National Insurance: Class 2 contributions (for the self-employed) to be abolished in the next Parliament
  • Self Assessment: abolition of the tax return in its current format and a move to digital tax accounts - in time
  • Savings: increased flexibility for ISAs and the introduction of the help to buy ISA
  • Charities: increase in “automatic” Gift Aid claims limit for small donations to £8,000

To read our full summary please click here.

Please contact Katharine Arthur, Head of Tax, if you require any further information and assistance.
Tel: 020 7969 5610