Capital gains tax Archives - WRLO Accountants

Chancellor promises to drive growth and raises £40 billion in taxes

WRLO Accountants — Sat, 02 Nov 2024 16:07:31 +0000

Chancellor Rachel Reeves pledged to ‘invest, invest, invest’ to drive growth and ‘restore economic stability’ in the Autumn Budget. The Budget, which was Labour’s first in over 14 years and the first ever delivered by a female Chancellor, saw £40 billion in tax announcements. Ms Reeves repeated her claims that the government had inherited a £22 billion ‘black hole’ in the public finances from the Conservatives. Pre-Budget speculation had centred on the likelihood of increases to employers’ National Insurance contributions (NICs), Capital Gains Tax (CGT) and Inheritance Tax (IHT). The Chancellor announced an increase to the rate of employer NICs by 1.2 percentage points to 15% from 6 April 2025. However, the Secondary Threshold – the level at which employers become liable to pay NICs on each employee’s salary – will reduce from £9,100 per year to £5,000 per year. CGT on non-residential assets will increase from 10% to 18% for those paying the lower rate, and 20% to 24% for those paying the higher rate for disposals from 30 October 2024. These new rates will match the residential property rates. The CGT rates applicable to assets qualifying for Business Asset Disposal Relief (BADR) and Investors’ Relief will remain at […]

The post Chancellor promises to drive growth and raises £40 billion in taxes appeared first on WRLO Accountants.

Raising CGT rates would not deter investment, says IPRR

WRLO Accountants — Sat, 26 Oct 2024 17:02:36 +0000

Increases to Capital Gains Tax (CGT) at the upcoming Budget would not deter investment into the country, according to the Institute for Public Policy Research (IPPR). The think tank says that low CGT is not an effective way at encouraging entrepreneurship and investment. Equalising CGT to income tax could help the Chancellor’s efforts to close the £22 billion hole in the public finances, with the IPPR saying doing so could raise up to £14 billion. The IPPR said investors and entrepreneurs do not consider CGT when they set up a company as CGT only becomes relevant at the point of selling a business or assets. The think tank claims low CGT rates are poor value for money, as they equally reward passive asset ownership and active entrepreneurship. Finally, it says that unequal tax on income and capital gains encourages employees to act as ‘businesses’, creating labour market distortions. The IPRR said: ‘Entrepreneurship and investment are vital to generating sustainable growth for the UK, but low capital gains tax is not an effective way at encouraging these activities. Instead, government and business must work together to make the most of the targeted support that is already on offer. ‘Closing the tax […]

The post Raising CGT rates would not deter investment, says IPRR appeared first on WRLO Accountants.

Reforms to IHT, CGT and NI ‘could raise over £20 billion a year’

WRLO Accountants — Fri, 04 Oct 2024 19:07:55 +0000

The Resolution Foundation has suggested that reforms to inheritance tax (IHT), capital gains tax (CGT) and national insurance (NI) could raise more than £20 billion a year. The Foundation said that the reforms could also pass a ‘triple tax test’ of improving tax efficiency, making sure that tax rises fall on those with the broadest shoulders. It said that Chancellor Rachel Reeves has ‘greatly limited’ her revenue raising options by pledging not to raise the main rates of income tax, corporation tax, VAT or NI. According to the Resolution Foundation, CGT is ‘ripe for reform’ as rates are ‘unjustifiably lower’ compared to those on other forms of income. Adam Corlett, Principal Economist at the Resolution Foundation, said: ‘There is widespread speculation about what might be in the first Budget of the new Parliament, but overall tax rises are a dead cert and time-honoured tradition. ‘Long overdue reforms to IHT, CGT and pension contribution reliefs would fit the bill and could raise over £20 billion if needed, while also making the tax system fairer and more consistent between different taxpayers.’ Internet link: Resolution Foundation website

The post Reforms to IHT, CGT and NI ‘could raise over £20 billion a year’ appeared first on WRLO Accountants.