4 minutes reading time (747 words)

Autumn Budget - A view by Michael Lansdell

Autumn Budget - A view by Michael Lansdell

 

 

Michael Lansdell is a founding partner of specialist dental and medical accountants Lansdell & Rose and a chartered accountant. Here, he gives a breakdown of the Autumn Budget 2017…

November 22nd was Budget day and therefore time for the ubiquitous articles on who were the ‘winners’ and ‘losers’ and what the Chancellor’s plans would mean for you. The heads up that the winning team was probably going to be rather smaller in number was the prediction from the Office for Budget Responsibility (OBR) that economic growth will be below 2 per cent for the next five years. For context, that’s one of the gloomiest forecasts that many can remember.

Philip Hammond faced a rather unenviable task, then, although no one was expecting any show-stopping statements either. Back in March, Hammond made a dramatic U-turn, scrapping the planned rises to National Insurance that he had announced in his Spring Budget just days before. For all sorts of other reasons, delivering a safe, steady and non-controversial Budget was always going to be the Chancellor’s intention.

Of course, there is always one thing that grabs report writers’ attention and this time around it was the decision to scrap stamp duty for first-time buyers on properties up to £300,000. We need to look behind the headlines to find out what will be most relevant to dental practice owners, though! Here’s what may impact on your financial planning for the year ahead…

Income tax

Both the personal and higher-rate thresholds were increased by around 3 per cent, which is in line with inflation, so no surprises there. For basic rate taxpayers, the personal allowance will increase to £11,850 and for those paying a higher rate the new figure will be £46,350. If you don’t want to see your personal allowance reduced, act now! If you make a pension contribution, or gift to charity, you can bring your income down to inside the new threshold.

Savings and investments

On the other side of the coin, anyone putting money into a pension saw the lifetime allowance increased from £1 million to £1.03 million (from 6 April 2018; no change to the annual allowance). If you are lucky enough to have funds that already exceed the £1 million limit, you might want to wait before you take your benefits. For those choosing an Individual Savings Account (ISA) or Lifetime ISA (LISA) the annual subscription limit will also remain unchanged, at £20,000 and £4000 respectively.

Capital taxes

A new 30-day payment window – between a capital gain arising and the payment of capital gains tax (CGT) – is now deferred until April 2020. With regards to inheritance tax, the nil rate band is to remain at £325,000. But don’t forget an important change due to start from 6 April 2018, when the inheritance tax residence nil rate band will rise to £125,000. If you don’t plan for this now, you could be significantly out of pocket when the time comes.

Property taxes and business rates

If you have been affected by the so-called ‘staircase tax’ (for businesses that occupy more then one floor of a building) you will be able to ask for your valuations to be recalculated. Another potentially relevant change was the switch to consumer price index (CPI) being bought forward to 1 April 2018. Also noteworthy is that the business rate discount for public houses with a rateable value of up to £100,000 will continue (subject to conditions) and non-domestic properties will be re-valued every three years following the next one, in 2020. In terms of planning, half of any interest for personal, buy-to-let borrowing will be limited to a 20 per cent tax credit from 2018/19, so make sure you understand if and how it will impact on you.

And finally!

The much-feted Making Tax Digital (MTD) scheme is still a work in progress – no business will be required to use it until 2019. When it has been shown to be successful, we can expect a roll out, but that won’t be until 2020 at the earliest. Getting prepared now won’t harm you at all though, as any business or individual within MTD will have to keep digital records and update HMRC quarterly. Maybe now is the time to review your record keeping.

The message? Plan ahead! A ‘steady-as-she-goes’ approach – while being meticulously organised and with the support of the right experts – will keep you focused and ready for anything as we embrace another year and whatever it may bring.

 

To find out more, call Lansdell & Rose on 020 7376 9333,

Or visit www.lansdellrose.co.uk

12 Days by @DentistGoneBadd
FGDP(UK) Announces Winners of Fellowship Awards 20...

Related Posts

 

Comments

Already Registered? Login Here
No comments made yet. Be the first to submit a comment

Please do not re-register if you have forgotten your details,
follow the links above to recover your password &/or username.
If you cannot access your email account, please contact us.