This year’s Autumn Budget was cancelled amid the ongoing economic response to Covid-19.
In the government’s words, “now is not the right time to outline long-term plans – people want to see us focused on the here and now.” They followed this up with roll-out of their new Winter Economy Plan.
With no Budget, it’s unlikely that any major tax changes will be introduced this year. However, don’t forget that the Office of Tax Simplification’s review of Capital Gains Tax (CGT) is still ongoing and will report in due course.
A scrapped Budget might mean a little extra time for those accelerating the sale of a business or assets which would be subject to CGT in anticipation of an overhaul of current rules, but it’s not an indefinite kicking of the subject into the long grass.
If nothing else, we know that the current economic environment is unpredictable. It would make sense for anyone who has started the process of selling a business, or crystallising assets at current CGT rates, to keep focused on progressing their plans, using the extra time to their advantage.
The scope of the review includes:
- the overall scope of the tax and the various rates which can apply
- the reliefs, exemptions and allowances which can apply, and the treatment of losses (eg Entrepreneur’s Relief (now called Business Asset Disposal Relief))
- the annual exempt amount and its interactions with other reliefs
- any distortions to taxpayers’ personal or business investment decisions
- interactions with other parts of the tax system such as Income Tax, Capital Allowances,
- Stamp Taxes and Inheritance Tax
- chargeable gains on shares and securities, including holdings of listed shares
- the acquisition and disposal of property
- the practical operation of principal private residence relief
- consideration of the issues arising from the boundary between income tax and capital gains
- tax in relation to employees
If you would like some advice on Capital Gains Tax or any other element of your financial and tax planning, please get in touch.