Break out the champagne! Last week the 2017 Finance Act was passed by government; a short and sweet 148 pages. Regular readers of this blog will be wondering what has happened to the 762 pages we were promised. Unfortunately, the government has not turned over a new leaf with a new simpler tax system. A large number of cuts were made in order to rush the bill through parliament before it dissolved ahead of the general election. So, what has hit the cutting room floor?
Small company owners will be pleased to see the tax-free dividend allowance, which is currently £5,000, for the time being will not be reduced to £2,000 in April 2018.
The money purchase annual allowance, the pension tax relief available if you have previously taken benefits from a defined contribution pension scheme, was initially going to be reduced from this tax year to £4,000, will now remain at £10,000.
Making Tax Digital, which was supposed to be launched next April, seems to have been put on ice for now. This is the system being introduced to make it easier for individuals, landlords and businesses to know their tax liability in real time.
So, are we safe from these cuts? Probably not, there will be another budget this Autumn and no doubt many of these areas will be re-visited then. If you will like to know more about any of the issues discussed above, feel free to get in touch with your local AIMS accountant.
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