Autumn Statement 2014 - The big push for votes
|Govt Deficit (% of GDP)||Govt. Deficit (£ billion)||Welfare Cap (£ billion)|
- projected to be in surplus in 2017
- a large number of jobs have been created
- there is still a deficit despite pre-election pledges to the contrary
- external economies have not done as well as anticipated
Inheritance Tax Planning
- This area in particular has seen several small tweaks which add up to a large difference for most people. All of which should be coming in next April.
- NISAs can now be passed on to beneficiaries.
- Scrapping the 55% income tax death tax on pensions.
- Guaranteed annuities can now be passed on tax-free before age 75.
- Changes only apply to residential - commercial properties are taxed the same.
- If you are buying a property worth less than £937,500 then you pay less stamp duty.
- If you are buying a property worth more than £937,500 then you pay more.
|Value||Amount Paid (old rules)||Amount Paid (new rules)||Difference||New effective rate||Old rate|
|£185,000 (avg. help2buy)||£1,850||£1,200||£650 saved||0.7%||1%|
|£275,000 (Avg. UK family home)||£8,250||£3,750||£4,500 saved||1.4%||3%|
|£510,00 (Avg. London home)||£20,400||£15,500||£4,900 saved||3.0%||4%|
|£10M mansion||£700,000||£1,113,750||£413,750 extra||11.1%||7%|
The rates ramp up over the threshold, so those wishing to buy mansions are penalised. Some will say this is a tax on aspiration but they will be in the 2% of people fortunate enough to be able to afford this type of property.
- New theatre in Manchester called ‘the factory’
- Massive infrastructure spending for the north - manufacturing is our fastest growing sector
- This includes A1 expansion, more roads and railways linking east to west in the north and bigger better trade links between the north and London.
- More funding for the sciences. The UK has been awarded lead role in the international mission to go to Mars. Research and development grants substantially increased and various other scientific projects awarded to the north of the country.
- A new scientific research centre looking at developing various materials (like carbon fibre etc.) in Manchester with outposts in other northern cities.
- Manchester is being set up as the centre of the powerhouse of the north.
- LIBOR fines to boost GP surgery numbers and more doctors.
- Banks can only offset 50% of losses from the crash against profits, rather than 100%.
- ‘GoogleTax’ – a 25% tax on companies that artificially transfer profits overseas. This isn’t an international profit steal and companies incorporated here won’t be taxed on genuine offshore profits.
- More work on aggressive tax avoidance strategies. Companies can no longer pay up to £8,500 benefits in kind for free as most were using this as an additional personal allowance.
- Air tax abolished for those under the age of 12 next May with air duty scrapped for under 16s in 2016.
- High-street discount to be increased to £1,500 and doubling the small rate relief meaning 380,000 businesses pay no business rates at all.
- Wholesale review into the 400 year old tax (business rates).
- No employer’s national insurance on apprentices under age 25.
- £10,000 loans to those studying at post-graduate level, allowing those on lower incomes to get their masters and doctorates (from 2015-16)
The devil is always in the detail. Get in touch with a member of our Financial Services Team for an accurate appraisal of how this affects you .