Tax Changes – April 2020
How will the UK Government pay for HS2 and all the other capital commitments they have suggested?
The Government will need to find a way to widen and deepen their tax base in a way that doesn’t increase tax for low income earners and that doesn’t stymie investment. It will be done in ways including reducing relief, changing non-income taxes, introducing charges, bringing forward deadline dates and increasing penalties – all of which are not, strictly speaking, increasing rates of income tax.
The Tory Party prides itself on reducing taxes, not increasing them. Perhaps we need to add an asterisk to this claim, a small disclaimer:
*except if referring to:
- Mortgage lettings relief (reduce relief);
- Stamp Duty Land Tax on residential dwellings (increase non-income taxes);
- The remittance basis charge (introduce charge)
The simple fact is any Government will need to raise more revenue in order to pay for the infrastructure required for this country. Here are some of the changes that are coming our way in April 2020:
- IR35 reforms – shifting the burden of ‘off-payroll’ reform to the clients, rather than the contractors;
- Divorcing couples – reduction of the ‘deemed occupation’ period of residence from 18 months to 9 months (at the end of ownership);
- Divorcing couples – loss of lettings relief to reduce CGT payable on residential property;
- Capital Gains Tax deadline – the payment window is moving from 31 January after the end of the tax year, to 30 days from the date of completion of the disposal
How else might HMRC raise more revenue in future? Check out the discussion here.
If any of these changes might affect you, or you would like to discuss in future detail, please don’t hesitate to get in touch at firstname.lastname@example.org or call 020 3746 1594.