Santa Osborne delivers gift-laden Autumn Statement

George Osborne delivered his Autumn Statement this afternoon, dishing out what some will call early Christmas presents and others policy U-turns.

Following increased concern from across both political parties, the Chancellor’s first big give-away was the scrapping of planned cuts to tax credits, a move that will be welcomed by families across the Thames Valley.

Pensions, families with young children in need of childcare, first time home buyers, women’s health and wellbeing charities and small businesses are all amongst those taking home an early Christmas gift.

Those losing out from Santa Osborne’s early visit include tax payers that need to deal directly with HMRC, second home owners and buy to let landlords, drivers of diesel company cars, and individuals selling residential property triggering a capital gains charge.

Ian Miles, a Partner in the Private Client team at James Cowper Kreston said: “George unsurprisingly delivered major support for policing, defense and the NHS.  The changes on tax credits, whilst perhaps not a surprise, will be welcomed across the political spectrum and by many thousands of families across the region.

“Those looking to get on the housing ladder are also one of the biggest winners today, with various packages of support available.  With house prices in the Thames Valley amongst the highest in the country this will be particularly welcomed.”

Ian adds: “The move to introduce personal digital tax accounts by HMRC is in principle a good idea, giving tax-payers greater information and the ability to manage their tax affairs.  But the Government does not have a great track record in delivering large-scale IT projects and the lack of personal support from HMRC is particularly worrying.”

Winners

• Families claiming tax credits – cuts planned for April 2016 have been scrapped.
• Pensioners – state pension increased by £3.35 to £119.30 per week from April 2016. New pensioners claiming from April 2016 will receive £155.65 per week.
• Families with young children – up to 30 hours of free childcare available for those working more than 16 hours a week with three and four year olds.
• First time buyers – 200,000 affordable homes available at a 20% discount for first-time buyers.
• Shared ownership homes – 135,000 homes to be built available on a shared ownership basis.
• Housing association tenants – right to buy to begin immediately - pilot in next few months.
• Small businesses – business rate relief extended for a further year.  However, this might not offset the significant change introduced in the July Budget that increased the tax on dividend payments – a common way SME owners choose to pay themselves.
• Charities which focus on women’s health and wellbeing.
• The NHS.
• Police and defense.

Losers

• Taxpayers who need to deal with HMRC.  Whilst digital tax accounts are to be welcomed, giving taxpayers greater information on their tax affairs, Government does not have a great track record of implementing IT schemes.  Real concerns over the lack of support available to taxpayers.
• Tax avoiders – further measures to stamp down on those taking deliberate steps to avoid paying tax.  A loser that will attract no sympathy.
• Landlords, second home owners and buy to let investors, facing a 3% higher rate of stamp duty from April 2016, together with a tighter payment deadline.  This is on top of the measure introduced in the July Budget to reduce tax relief on loan interest relating to residential property.
• Company car owners with diesel cars.
• Individuals selling residential property that triggers a capital gains charge. Consultation in progress which could lead to capital gains tax having to be paid within 30 days of completion, from April 2019.