The personal allowance increases from £11,850 to £12,500 from 6th April 2019. The allowance will also remain at this level for the 2020/21 tax year.
The basic-rate limit increases from £34,500 to £37,500 from 6th April, 2019.
Consequently, this will increase the higher-rate tax threshold from £46,350 to £50,000. This limit will remain in place for the 2020/21 tax year.
The starting rate band for savings will remain at £5,000 for the 2019/20 tax year.
Future Increases To The Personal Allowance And Basic-Rate Band
From 2021/22, the personal allowance and the basic-rate band will be indexed with the Consumer Price Index (CPI).
Company Car Benefit
The car fuel benefit multiplier increases from £23,400 to £24,100 from 6th April, 2019.
From 6th April 2019, the flat-rate van benefit charge increases from £3,350 to £3,430 and the flat-rate van fuel benefit increases from £633 to £655.
The adult ISA annual subscription limit remains at £20,000 for 2019/20.
The junior ISA annual subscription limit and the Child Trust Fund annual subscription limit both increase from £4,260 to £4,368 with effect from 6th April 2019.
Lifetime Allowance For Pensions
The lifetime allowance for pension savings increases for 2019/20 from £1.030M to £1.055M.
The limit of individual donations made under the gift ain small donations scheme has increased from £20 to £30. Under this scheme, donations are made in cash or by contactless payment.
This measure takes effect from 6th April 2019.
National Living Wage
The national living wage increases 4.9% from £7.83 an hour to £8.21 an hour from 6th April 2019.
Voluntary Tax Returns
Due to recent legal challenges regarding the validity of voluntary tax returns, legislation is being introduced to ensure returns will be accepted as valid returns on a statutory basis.
Social Security Payments
The Government confirmed the tax-exempt treatment of four existing social security benefits:
- discretionary support scheme
- council tax reduction scheme
- discretionary housing payments
- flexible support fund
The Scottish Government is introducing five social security payments. Four of these will be legislated as tax-exempt:
- young carer grant
- best start grant
- funeral expense assistance
- discretionary housing payments
A fifth, carer's allowance supplement, will be a taxable payment.
This measure takes effect on the date of royal assent of the Finance Bill 2018/19.
Capital Gains Tax
Capital Gains Tax Annual Allowance
The capital gains tax (CGT) annual exempt amount for individuals rises from £11,700 to £12,000 from 6th April 2019.
The Government has increased the minimum period for which certain conditions must be met in order for Entrepreneur's Relief (ER) to be available from one year to two years. This measure will effect for disposals made on or after 6th April 2019.
The one-year qualifying period will continue to apply for business disposals made on or after 6th April 2019, provided that trade creased before 29th October 2018.
The Government also announced two new tests to the definition of a 'personal company' in relation to the qualifying criteria for ER to be available.
For disposals on or after 29th October 2018, all claimants must possess a 5% interest in both the distributable profits and the net assets of the company in order to be eligible to claim.
These tests must be met for the specified period for relief to be obtainable.
From April 2020, lettings relief will only be available in circumstances where the owner of the property is in shared occupancy with the tenant.
Private Residents Relief
The final period of exemption will be reduced from 18 months to nine months with effect from April 2020.
Capital Gains Tax For Non-UK Residents
From 6th April 2019, all non-UK resident personas disposing of UK immovable property will be liable to CGT on gains arising from interests in any type of UK land.
In addition, all non-UK resident personas disposing of shareholdings in an entity that derives 75% of more of its gross asset value from UK land shall be taxed on any gains arising.
Residence Nil-Rated Band
The residence nil-rated band (RNRB) increases from £125,000 to £150,000 from 6th April 2019 and to £175,000 from 6th April 2020.
For estates with a net value of more than £2M, the withdrawal rate is tapered by £1 for every £2 over the £2M threshold.
Any unused RNRB can be transferred to a surviving spouse or civil partner.
Minor technical changes relating to the downsizing provisions and the definition of 'inherited' for RNRB purposes have also been made.
For further information on any of the above, please contact Elpizo Accountancy.