The Chancellor presented his first Spring Statement on Tuesday 13 March
Common sense has broken out!
For the avoidance of doubt, the Budget now takes place in the autumn (the first Autumn Budget having taken place in 2017).
This means that major tax or spending changes should now only occur in the autumn. I reckon this is far more sensible than the old approach where we effectively had two budgets per year (we were the only major economy to do this). Indeed, a single budget is seen as best practice by the OECD and the IMF. Also, moving the budget away from the spring is sensible as the timescale between budget & new tax year was proving far too short.
The purpose of a Spring Statement?
Give an update on the overall health of the economy and OBR forecasts
Give an update on progress made since Autumn Budget 2017
Invite interested parties to give views on changes the government is considering
Anything of specific interest for financial advisers?
Not really. I had my eyes peeled for the possible publication of a ‘trusts’ consultation bearing in mind that in the Autumn 2017 Budget, the government announced that it will publish a consultation in 2018 on how to make the taxation of trusts simpler, fairer, and more transparent. However nothing has transpired.
The government has however published a ‘consultation tracker’ to help us techies keep up to date with what’s going on. This shows many consultations on the go but with little of interest for most financial advisers. To illustrate the point, these are probably the top 5 most relevant…
Taxing gains made by non-residents on UK immovable property
Call for evidence on how rent a room relief is working and options for reform
Consultation on how to make the employment status rules clearer
Consultation on extending time limits to assess tax in cases involving offshore income, gains or chargeable transfers
Consultation on creating a fund structure within the EIS for investment in innovative knowledge-intensive companies
How does this new timetable work?
Measures announced in the forthcoming Autumn Budget 2018 will be consulted on over the course of winter & spring leading to draft legislation being published in July 2019. This will lead to an announcement in the Autumn Budget 2019. The 2019/20 Finance Bill will then be published in autumn 2019 and should ultimately become law effective from April 2020.
Essentially, the annual Spring Statement sits outside of this 16 month cycle. It provides HMRC with the opportunity to publish consultations before specific measures are announced. These consultations however will not normally be for inclusion in the Finance Bill later that year.