Today's autumn statement by the chancellor has been described as an attempt to win votes, with the Government looking to steer a steady course to next year's general election.
Key points for business from George Osborne's statement:
1. Stamp duty land tax on commercial properties (4% tax rate on property above £500,000, below £500,000 3%) remains unchanged despite reform of residential stamp duty
2. Continuation of business rate multiplier capped at a 2% increase. A review of the rating system will be carried out before the 2016 budget.
3. The Office of Tax Simplication has issued consultation documents on benefit in kind reporting. Osborne said the Government would implement 51 of the 58 recommendations put forward. He didn't say which 51.
4. Pay rolling of benefit in kind: Employers can now voluntarily payroll BIK, rather than via P11Ds at year end, saving on admin time.
5. Special rules applying to low paid workers (below £8,500) have been removed.
6. Minor benefits, below £50, will be exempt from tax.
7. A number of employers pay travel and subsistence through salary sacrifice schemes. They will not now qualify for tax relief.
Alistair Kendrick, director at MHA MacIntyre Hudson, said on the exemption of minor benefits: "This is mean as £50 is far lower than anticipated. I expected it to be in the region of £200-250. Instead we have a token gesture."
On point five, he said: "It's annoying that this will mean those workers that do benefit will be taxed more heavily than they already are and I would have expected the Government to cushion this blow since it was aware of this impact."
And on the travel and subsistence change, Kendrick said this would spell the end of the salary sacrifice schemes.
He concluded: "Osborne is treading carefully ahead of the election next year, there were no shocks as he sought to steer a steady course to May."
Matthew Hodgson, partner at UHY Hacker Young, said of the autumn statement: “The chancellor has today announced an upbeat autumn statement off the back of a 3% increase in the UK’s GDP this year, and similar growth expected for 2015.
"The UK’s automotive industry has been key to the UK’s economic recovery, and we often forget the fact that many of the world’s largest franchised brands manufacture cars for the UK and international markets, on our doorstep.
"The UK has also bolstered sales during the last two to three years for many of these brands who continue to suffer in Europe and further abroad. In addition, the business network which supports these manufacturers is enormous, and combined with the manufacturers and retailers generates thousands of quality jobs and apprenticeships for this country.
"The chancellor’s welcome introduction of £10,000 loans for post-grads, and a £250m investment in a major new National Institute for Materials Research and Innovation can only contribute to the continued investment in the UK’s automotive industry, and help to secure its future.”
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