Tax Changes Announced in the UK
November 30, 2011 Taxation in UK
LONDON – The UK Chancellor of the Exchequer George Osborne outlined upcoming tax changes in the UK during the annual Autumn Statement.
On November 29th the UK Chancellor of the Exchequer George Osborne delivered the annual Autumn Statement, in which he outlined the government’s upcoming intentions regarding the economy and fiscal policy.
Under plans for boosting the nation’s economic expansion, the government of the UK announced a number of tax changes which are aimed at aiding small and medium sized enterprises in the country.
In order to encourage investment into startup companies, the government of the UK will soon implement the new Seed Enterprise Investment Scheme, which grants taxpayers a 50 percent relief on their income tax liabilities when investing into the shares of newly established businesses. The capital gains realized from investing into startup firms will also be exempt from payments of capital gains taxes until the end of the 2013 fiscal year.
Small business owners will see an extension on their currently active tax relief holiday until October 2012.
The government will instate a new research and development tax credit by the end of 2013. The credit will be aimed at encouraging large companies to conduct research in the UK, but measures will also be taken to ensure that small firms do not lose incentive to develop new products.
The country’s Air Passenger Duty will be extended on April 1st 2013 to also cover business jet travelers.
The planned GBP 3.2 pence increase to fuel duties will be postponed from the start of 2012 to August 2012. However, a 5 pence exemption on fuel duties will be implemented in remote regions of the UK, to help encourage regional economic development.
The currently active exemption on Stamp Duty Land tax for first time house buyers will be removed, as it is deemed to have been ineffective at encouraging greater numbers of property purchases.
The government will allow individuals and companies to receive reductions in their tax liabilities when donating historical objects or works of art to the country.
The draft legislation for all of the announced changes will be presented to legislators on December 6th.
Photo by Foreign and Commonwealth Office