Personal announcements – England
Income tax personal allowance
The income tax personal allowance will increase from £9,440 to £10,000 in 2014/15, and further increase to £10,500 in 2015/16. The higher allowances for those born before 6 April 1948 will not be increased.
The basic rate limit will reduce from £32,010 to £31,865 in 2014/15 and further reduce to £31,785 in 2015/16.
However, the higher rate threshold will increase from £41,450 to £41,865 in 2014/15 and further increase to £42,285 in 2015/16.
Transferable tax allowances for married couples and civil partners
With effect from 6 April 2015 it will be possible for one spouse or civil partner to elect to transfer £1,050 of their personal allowance to their fellow spouse or civil partner, providing that neither the transferor nor transferee are higher rate taxpayers. This will provide a financial benefit where one spouse or civil partner has an income less than their personal allowance.
From 2016/17 the transferable amount will be 10 per cent of the personal allowance.
Social investment tax relief
The Government has announced that the rate of income tax relief will be 30 per cent for qualifying subscriptions in social investments from 6 April 2014.
Enterprise Investment Scheme (EIS) and Venture Capital Trust (VCT)
A number of changes are being made to EIS and VCT including allowing investors to subscribe for VCT shares via nominees with effect from the date of Royal Assent to Finance Bill 2014.
Artificial use of dual contracts by non-domiciles
A measure is to be introduced that is directed at UK resident non-domiciles paying income tax on the remittance basis who use separate employment contracts for UK and overseas duties with the same or associated employers.
The measure will tax non-domiciles on the overseas employment income it identifies according to the ‘arising’ basis. That is, the income caught by this measure will cease to be eligible for the remittance basis tax treatment.