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News - Published 16th November 2017

Autumn Budget 2017 Wish List

Autumn Budget 2017

Chancellor has rare opportunity to deliver tax cuts and make simplifications

Richard Godmon - Menzies AccountantComments provides by Menzies Partner Richard Godmon

With the focus on austerity continuing, concerns are growing that the Chancellor could remove some tax breaks intended to incentivise entrepreneurial investment. This could have disastrous consequences for the UK economy.

Since its introduction in April 2016, Investor’s Relief has been welcomed as a tax break for individuals wishing to invest in a trading company without necessarily being a direct employee or a named director. As the tax relief requires individuals to hold shares for a minimum period of three years, no one has yet benefited from the tax break, which will allow them to pay tax on eligible gains from share disposals at the discounted rate of 10%.

When the former Chancellor first introduced this tax break in April 2016, it was intended to incentivise an important group of investors, who wouldn’t normally qualify for Entrepreneurs’ Relief because they aren’t remunerated by the business they are investing in.

While it is too early to say how many individuals are expecting to benefit from the tax break, it is likely to be at least as many as currently claim Entrepreneurs’ Relief, and possibly more.

Tax reliefs in this area have begun to attract more attention from the Treasury however, as they are costing more than expected. A report published by the National Audit Office in 2013 revealed that the cost of Entrepreneurs’ Relief was £2.9 billion in 2013/14, three times more than originally expected. Part of the increase was probably due to the fact that the annual threshold for Entrepreneur’s Relief claims has risen from £1 million to £10 million, but the NAO also wondered whether there was undetected avoidance.

Based on these figures, it would not be unreasonable to assume that Investor’s Relief, which has a similar threshold for claims, could cost the Chancellor a similar figure when it kicks in from April 2019 onwards.

Read more of Richard’s pre-budget comments

man making a business wish

Autumn Budget 2017: Business Sector Wish Lists

Here follows a summary of the headline wish lists for the Chancellor’s 2017 Autumn Budget from each of Menzies’ business sector teams.

For more information about Menzies LLP or to talk to us about the impact of the Autumn Budget 2017 and implications on your business and personal finances, contact your Menzies Relationship Partner directly or complete our online contact form.

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Posted in News, Business Services, Healthcare, Hospitality & leisure, Manufacturing, Not-for-profit, Property & construction, Retail, Technology, Transport & logistics

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Richard Godmon is a Menzies Tax Partner in the Solent office specialising in business tax for SME businesses and personal tax planning for individuals.