The last ever Autumn Statement
Philip Hammond is not the kind of man to excite his audience. Indeed, at the despatch box, he does a pretty good imitation of Lord “Dead Sheep” Howe on a slow day.
The best news was when he announced that this was to be the last ever Autumn Statement. However, before the cheers could even die down, he trumped (pardon the expression) himself by proposing not one but two Budgets in 2017. Cue for collective groans from across the House, one imagines.
This column was delayed to cover the exciting measures in Mr Hammond’s debut in this role so here are a few.
Removing National Insurance from the effects of the Limitation Act
If my interpretation is correct, the rules around deadlines and penalties for NIC are to be brought in line with income tax, more particularly PAYE. That will make life considerably simpler for those of us that specialise in this area, not to mention our counterparts in HMRC.
As previously mooted, termination payments over £30,000 will soon be subject to employer’s NICs. The announcement is not well written but it also appears that all PILONS will be taxable in future. This may well be widening the net from the original proposal. The first £30,000 of a termination payment will remain exempt from income tax and National Insurance.
This is a goodie as most of those involved will have been unwittingly evading tax for years.
From April 2017, all employees called to give evidence in court will no longer need to pay tax on legal support from their employer. Did anyone?
Valuation of benefits in kind
The government is looking at benefits in kind valuations. In particular it plans to publish a consultation document on employer-provided living accommodation, which currently uses an inoperable, antiquated system and also consider the valuation of all other benefits in kind.
Employee Shareholder Status
Earlier this year, George Osborne was too embarrassed to abolish this illegitimate baby of his. Instead, he emasculated it by reducing tax relief to a maximum of £20,000. His successor has no such qualms so the ill-considered brainchild of political expediency will not even survive until the end of next week.
Disguised Remuneration Schemes
There are plans to attack disguised remuneration schemes used by the self-employed. This is rather confusing, since by definition the self-employed do not receive remuneration. The details of this plan will be interesting.
Strengthening tax avoidance sanctions and deterrents
The attack on advisers is now building.
Philip Hammond has confirmed that he is to introduce a new penalty for any person who has enabled another someone to use a tax avoidance arrangement that fails.
The government will also remove the defence of having relied on non-independent advice as taking ‘reasonable care’ when considering penalties in connection with such arrangements.
Attacks on Alleged Serious Serial Abusers
There may have been some technical announcements in this area, but the big ticket stuff was sorely lacking.
To give Mr Hammond a clue, if he needs to understand what super avoiders are up to, he could do worse than take advantage of Starbucks’ free Wi-Fi to log into Google and search for Amazon’s site in time for Black Friday. Who knows, there might even be some cut-price tax avoidance schemes on sale?
Philip Hammond pledged to cut UK tax legislation in half by 2020. Already the Treasury furnaces are being cranked up to welcome the conflagration.
Or not. That was a wish from the profession that has been ignored this time around.