Finance (No 2) Bill was published on Tuesday 25 March, debated in the Chamber of the House during the afternoon of 26 March and received Royal Assent on Thursday 27 March.
Finance Act 2015 is 340 pages long and contains 127 sections and 21 Schedules !!!
For those who are not entertained by this impressive document I am picking out my personal thoughts on the most significant and relevant items, including some not in the Finance Act, in three blogs covering the capital taxes, business and corporate and ‘the rest’.
This first blog summarises my pick of the capital gains tax and inheritance tax measures.
For those who are entertained by a good Finance Act here is the link to the legislation – https://goo.gl/yNY27Z. These brave souls should be aware that the average length of Finance Acts during each year of the Coalition was just over 500 pages …. so by the time there is a second Finance Act after the May election the length of Finance Acts in 2015 will probably be very much the same.
CAPITAL GAINS TAX
Entrepreneurs’ relief
The clarification of the circumstances when disposal of an associated asset will qualify for 10% CGT is welcome ( section 41 ), though it is disappointing to see the new restriction for goodwill disposals to connected parties.
This latter measure will also have a direct effect where a business has not already incorporated and is considering doing so.
The door has been closed on structures used to create the necessary 5% qualifying holding through joint ventures where individuals had an indirect involvement of less than 5%.
Wasting assets
Following the recent Castle Howard case reported in my Professional Tax Review, it was no surprise that HMRC has introduced new regulations as anticipated ( section 40 ).
Most tax advisers and private client solicitors will no doubt be looking to structure the ownership of old masterpieces so they are not caught.
See my blog of 20th March for more detail on the Supreme Court decision which gave rise to the new position – https://goo.gl/MBhF8F
Residential property
In addition to the new stamp duty land tax rates, there is now a restriction to the Principle Private Residence Relief for capital gains tax ( section 39 & Schedule 9 ) affecting disposals by non-residents and the new lower bandings of the ATED (annual tax on enveloped dwellings) charge ( sections 70 – 73 ).
INHERITANCE TAX
It is excellent news that the introduction of a single settlement nil-rate band will no longer be implemented.
More ominously further anti-avoidance rules on the use of multiple trusts are anticipated.
It is to be hoped that the further review on the use of deeds of arrangement will not get far, as has happened on previous occasions. My blog of 19th March considers the background which gave rise to the review – https://goo.gl/zcNgzG
