The devil, they say, is in the detail. Unfortunately, one of the hallmarks of this year’s Autumn Statement, issued by Chancellor George Osborne to a boisterous House of Commons on 5 December, is that a lot of the detail is yet to come.
We already knew that the Government is creating a Business Bank “to transform the way that Government delivers support to small and medium enterprises” (SMEs). We are now told it will “deploy £1 billion of additional capital to address structural gaps in the supply of finance to SMEs and stimulate the provision of long-term capital”. However, before we can advise clients in applying for this welcome support, we must wait for the Secretary of State for Business, Innovation and Skills to set out “further details later in December 2012”.
The introduction of the UK’s first ever General Anti-Abuse Rule (GAAR) is set to “provide a significant new deterrent to abusive avoidance schemes and strengthen HM Revenue & Customs’ means of tackling them”. So what advice can we give you in this area? Again, guidance and draft legislation on the GAAR will be published “later in December 2012”.
Proving November’s widespread speculation to be correct, from April 2014 the lifetime allowance for pension contributions will reduce from £1.5 million to £1.25 million, and the annual allowance will further reduce from £50,000 to £40,000. However, we do not yet know whether this reduction in the annual allowance threshold will also be applied to the amount you can carry forward from the three preceding years. We are told that the Government will offer a fixed protection regime to individuals to prevent any retrospective tax charges from reducing the lifetime allowance; and that “the Government also wishes to offer a personalised protection regime for individuals, in addition to fixed protection” and – guess what! – “will discuss the feasibility of this with interested parties in the coming months”.
We will, of course, let you have more news and views on the above topics as they emerge.
Meanwhile, one great piece of news (which seems to be clear cut) is that the Annual Investment Allowance will increase ten-fold, from £25,000 to £250,000 per year, for qualifying investment in plant and machinery over the two year period beginning 1 January 2013. This is designed to encourage and incentivise business investment in plant and machinery, particularly among SMEs.
For more details from the Autumn Statement, generally, click here.