The 2014 Autumn Statement was delivered by George Osborne on 3 December 2014. As usual, there were lots of headline grabbing announcements which affect big business and individuals, such as Google tax, the ability on death to pass ISA’s onto your estate with tax protection, and the air passenger duty exemption for children. However, we’ve identified a few which impact directly on small businesses.
Income Tax
From April 2015, the Income Tax personal allowance will increase to £10,600. The basic rate limit will be £31,785 so the higher rate threshold above which individuals pay Income Tax at 40% will be increased to £42,385.
Stamp Duty
In a major reform of stamp duty land tax (SDLT), the ‘slab’ system for residential properties (based on a single percentage rate by reference to the band in which the price paid for the property falls) will be replaced by rates for the portion of the price within each band. The thresholds and rates will also be changed. The new rates and thresholds are as follows:
| Property value | Rate |
| £0 - £125,000 | 0% |
| £125,001 - £250,000 | 2% |
| £250,001 - £925,000 | 10% |
| £925,001 - £1,500,000 | 10% |
| £1,500,001+ | 12% |
Capital Gains Tax: Restricting Entrepreneurs’ Relief (ER): restricting unfair tax advantages on incorporation
The Government will prevent individuals from claiming ER on disposals of the reputation and customer relationships associated with a business (‘goodwill’) when they transfer the business to a related close company. This will affect transfers on or after 3 December 2014.
For all relevant incorporations, on or after 3 December 2014, relief will be calculated at the time of any eventual disposal of the asset rather than at the time the expenditure is incurred.
National Insurance
The Chancellor said national insurance for apprentices aged under 25 will be abolished, benefiting around 500,000 apprentices.
Business rates
Small business rate relief will be extended until April 2016, resulting in 385,000 small businesses receiving 100% rate relief.
