WHILE the chancellor’s Autumn Statement this year may be short of pyrotechnics, advisers across the profession do seem to agree George Osborne has a few sparklers at his disposal.
And while he may choose to leave them unlit this time around, there are several distinct areas the government may direct their attentions to.
They come, though, with the caveat that there is little room for giveaways on the tax front, with EY’s ITEM Club rather starkly warning “the cupboard is bare”.
But while the chancellor seeks to restock the cupboard, many advisers believe is scope for some moves of significance.
Chief among them is likely to be further weapons against tax avoidance, something that has very much characterised this government’s term. This year has seen substantial change. Not least the introduction of advanced payment of disputed tax and the direct debt recovery powers from those repeatedly failing to pay. It would be of little surprise if more follows, advisers say, particularly given the desire to be an early adopter of the OECD’s recommendations on Base Erosion and Profit-Shifting (BEPS) by multinational companies.
Then there is the devolution of tax-related powers to Scotland. The government made some big promises during the referendum and have already delivered on income tax, VAT and some more minor levies. Some more might follow, while the Welsh and Northern Irish may gain similar powers to those already devolved.
One of the more substantial changes to emerge from March’s Budget was the surprise changes to pension rules, allowing people to dip into their pension pots when they want, ending the requirement to buy an annuity.
Those rules come into force in April 2015, and a significant section of advisers expect further clarifications and regulations to be announced. In a similar vein, it has already been revealed that there will be an end to the 55% tax charge on inherited pensions.
Another major change expected to be covered in the chancellor’s address is to the Patent Box, which is likely to be watered down after a compromise was reached with Germany and the OECD. The proposed altered regime will require tax benefits to be connected directly to R&D expenditures, the Treasury said in November. It is expected to retain an option for UK businesses to grandfather intellectual property already in the existing regime, too.
One move practitioners seem keen to see would be a cut to business rates, which many feel disproportionately affects the high street and other businesses with large estates.
As far as moves that are unlikely happen are concerned, there a few eminently sensible ones that simply have no driving force to see them brought in at this point.
Those include the age-old call to align National Insurance Contributions and income tax and the possibility of alerting the 40p and 50p tax bands, which carry with them too much political sensitivity to prove an attractive proposition.
However, most agree increasing the personal allowance is again set for a rise, as it has at almost every opportunity throughout this government.
Quite apart from any of that, though, is the desire for a moratorium on the ‘tinkering’ the government has engaged in in the past, and there is no area in which that attitude is felt more strongly than in tax reliefs.
The argument goes that both the tax profession and business and the economy more widely would benefit greatly from a period of stability. Not only that, but it self-evidently creates more complexity and makes more work for John Whiting and his colleagues at the Office of Tax Simplification.
However, the government, keen to incentivise particular industries seems unlikely to deviate from a well-worn policy.
Crowe Clark Whitehill , the top 20 accountancy firm, has announced the promotion of Chris Mould to partner
HMRC is continuing to ramp up the number of raids on premises it carries out as part of criminal investigations, searching 761 properties in the last year
The latest opinions from Accountancy Age on Making Tax Digital, and outline plans to evolve the UK's corporate governance regime
Five million taxpayers are ow using digital personal tax accounts (PTA) as part of the making tax digital strategy, HMRC said