Budget 2020: The REAL News (well, my quick thoughts)
As always, a lot of the tax detail gets buried in the Chancellor’s budget day speech, we get lots of little sound bites about tax on beer and such, but little detail on the big movements.
So, what devil has our new Chancellor, Rishi Sunak, left in the detail for us to extract…
We have of course seen the MASSIVE shift in entrepreneurs relief. Now, I’m not claiming any Nostrodamus level foresight here, as I think most of the profession guessed the most likely movement here would be a reduction in the lifetime allowance rather than a full abolition of the relief. This will see the government will introduce legislation in Finance Bill 2020 reducing the lifetime limit on gains eligible for Entrepreneurs’ Relief from £10 million to £1 million for qualifying disposals made on or after 11 March 2020.
We also saw the MONUMENTAL give away of £104.16 per annum as a result of the National Insurance limit increase. Yes, I am being sarcastic, as I do get annoyed by things like this when politicians crow about it as if giving people an extra £2 a week is like them winning the lottery!
Something many might have missed will be the change to the tapered annual allowance for pensions . The two tapered annual allowance thresholds (currently £110,000 and £150,000) will each be raised by £90,000, and the minimum tapered annual allowance will be decreased from £10,000 to £4,000 from 6 April 2020. So, from 2020 to 2021 and subsequent years the threshold income limit, the point at which an individual is assessed for the taper, will be £200,000, and the adjusted income limit, the point at which the annual allowance begins to reduce will be £240,000. Many business owners (and government employees no doubt) will welcome these changes following recent difficulties after the tapering rules were brought in.
There’s a load of other stuff in the OOTLAR – Overview of Tax Legislation and Rates, which can be found here (https://bit.ly/2U0OqGQ), happy reading!