So Where Are We Now?
The budget seems a long time ago now and while I never like to consider its proposals in too much depth until at least the announcements have made it through to a green paper, now is probably as good a time as ever to consider its proposals.
A number of measures have been introduced to limit the availability of the remittance basis of taxation to Non UK domiciliaries and while it is clear that things will never be the same again, there have been a number of concessions made in the drafting of the finance bill/ act in relation to trust structures. It will not be clear until after the Finance Act has received Royal Assent and the legislation has been properly considered, how the land lies; but for those individuals using trusts to manage their wealth the position may not be as bad as had been feared.
The proposed legislation to counter income shifting has been postponed (no doubt because there are problems with the drafting). This provides individuals who have set up family companies and partnerships the opportunity to enjoy the benefits until at least next April. Whether these problems are resolved by then (and the effects of a looming general election factored in) will remain to be seen.
There’s good news and bad news on the Capital Gains Tax front. Our friends involved in the private equity industry are going to have to look for more cunning ways of finding tax efficiencies as Business Asset Taper Relief (providing a 10p rate of tax) on gains has been abolished.
As a concession an entrepreneurs relief has been introduced which will provide an effective 10p rate on the first £1m over an investor’s lifetime. Nowhere near as good as taper relief but better than a poke in the eye with a sharp stick!
The good news on gains is that where entrepreneurs relief is not available the rate of CGT has been dropped to 18% for both basic rate and higher rate taxpayers, which historically, is about as good as it gets!
A number of measures have been introduced to limit the availability of the remittance basis of taxation to Non UK domiciliaries and while it is clear that things will never be the same again, there have been a number of concessions made in the drafting of the finance bill/ act in relation to trust structures. It will not be clear until after the Finance Act has received Royal Assent and the legislation has been properly considered, how the land lies; but for those individuals using trusts to manage their wealth the position may not be as bad as had been feared.
The proposed legislation to counter income shifting has been postponed (no doubt because there are problems with the drafting). This provides individuals who have set up family companies and partnerships the opportunity to enjoy the benefits until at least next April. Whether these problems are resolved by then (and the effects of a looming general election factored in) will remain to be seen.
There’s good news and bad news on the Capital Gains Tax front. Our friends involved in the private equity industry are going to have to look for more cunning ways of finding tax efficiencies as Business Asset Taper Relief (providing a 10p rate of tax) on gains has been abolished.
As a concession an entrepreneurs relief has been introduced which will provide an effective 10p rate on the first £1m over an investor’s lifetime. Nowhere near as good as taper relief but better than a poke in the eye with a sharp stick!
The good news on gains is that where entrepreneurs relief is not available the rate of CGT has been dropped to 18% for both basic rate and higher rate taxpayers, which historically, is about as good as it gets!
Labels: Written by Mark Busby
posted by Davis Burton Sellek at
08:47
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