January 07, 2015

George, the Autumn Statement, your business, and you - Part 2

Autumn Statement

The Autumn Statement part 2 – what we couldn’t fit in last week

There was so much in George Osborne’s Autumn Statement on 3 December that we couldn’t possibly fit it all into one blog so we thought we’d write another one to cover all the areas we missed – we are accountants after all and attention to detail is definitely our thing! 

So without further ado…

VAT’s life!

VAT obligations are about to change big style – from 1 January 2015 businesses of all kinds (including creative’s) will feel the impact. VAT will apply depending on where you are when you buy a product and not where the product is actually bought from. This could have consequences for those businesses who have customers across a wide geographical area (we all know how extensive the online arm is). It might be useful to get some expert advice about your VAT obligations to make sure you’re fully aware of how this could affect your company, whatever industry you’re in.

Ah yes, the car fuel benefit charge

This one affects directors and their employees with company cars who are lucky enough to have part (or all) of their fuel paid for by their company. A fuel benefit charge is worked out by multiplying a notional list price of the car by the correct percentage for the car based on its CO2 emissions.

The notional list price of a car will rise from £21,700 to £22,100 from 6 April 2015 regardless of any change in fuel price. As an example, a reasonably priced company car emitting between 121g and 125g CO2 per km would incur 20% of the £22,100, resulting in taxable fuel benefit of £4,420 as well as £1,768 income tax for a 40% taxpayer. When you work out the pence per mile you’d need to drive in order to make the private fuel benefit worthwhile, you probably wouldn’t even feel like starting the engine!

One man and his van

When it comes to company vehicles, employees given a company van (they’re not always white!) will find that their taxable benefit is to go up from £3,090 to £3,150 in 2015/16. In addition, there’s a benefit (taxable of course) of £594 where private fuel is provided by their employer – beware though, because this is a charge that only applies to those who use their company van for private journeys…

CGT you say?

There’s always something about CGT in the Autumn Statement and December’s was no exception. This year it came via an announcement that CGT is to be set at £11,100 in 2015/16 so if you’re one of those higher rate taxpayers affected by the 28% rate, you’re going to find yourself with an extra £3,108 in your pocket. No complaints there then.

CGT and the great UK residential property debate

After much talk and consultation, the introduction of a capital gains tax charge is to come into force from 6 April 2015 affecting non-residents selling UK residential property. Although the finer details have yet to be decided, the general idea is that unless a non-resident individual spends a ‘substantial’ amount of time each year in their UK property (at least 90 nights) they won’t qualify for the CGT relief when they do sell.

Now that we’ve managed to fill you in on a few more things that came out of this year’s Autumn Statement, we can finish by offering our expert advice on any of the items we’ve mentioned. So, if you’d like to know if or how any of them affect you or your business, get in touch and we’ll be more than happy to help.

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