Autumn Statement 2016 – Predictions
Ahead of this year’s Autumn Statement, Rob Durrant-Walker, head of business tax at Leeds & York based accountancy firm Garbutt + Elliott, shares his thoughts on what could in store for businesses.
“Predicting government financial policy can be a tricky task, especially when statements can include left-of-field policies such as this year’s cutting of capital gains tax when they had been signposting an increase. Add the fact that we have a new chancellor, whose management style we don’t yet know, and the uncertainty abounds.
“Compared to the Budget, the Autumn Statement focusses on the Chancellor’s broad overview of the nation’s finances and the state of the economy, but has increasingly become a mini-budget in recent years. I think there are some specific tax predictions we can make.
“We predict that the Government will not cut corporation tax any further than already announced, due to the lack of fiscal room. We also do not expect that the Government will increase tax in the buy to let marketplace, having already hammered it with the additional 3 per cent stamp duty land tax for second homes and buy to let properties in April, and mortgage tax relief reductions from 2017.
“Predictions pose a conundrum with the Government’s overarching commitment to raising taxes, especially when combined with its election commitment to freezing the main rates of VAT, national insurance and income tax. With these freezes in place, it is likely the chancellor will seek to raise taxes on the fringes and target niche groups – such as with buy to let owners in the past.
“One recent trend that we could see continuing in the long term is bringing forward tax payment dates. HMRC are recognising the benefits of cash flow following the recent introduction of a 30 day payment term for the capital gains tax on non-residents selling UK property – something which will extend to everyone by 2019 – and bringing forward corporation tax payment dates for some large companies from April 2017. HMRC could be looking at other areas.
“Broadly speaking we’d like to see a return to a single annual financial statement from the chancellor, and less complexity. This would provide greater clarity and certainty for businesses but only time will tell.”
Garbutt + Elliott is an independent firm of chartered accountants, auditors and advisors and offers tailored services for individuals and businesses. With a reputation built on providing excellent client service and an in-depth understanding of the needs of entrepreneurial business owners, Garbutt + Elliott is fast becoming the go-to accountancy firm for organisations across Yorkshire and beyond.
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