Many of you will have seen the budget last week. There are a lot of changes over several years! In the short term there are three areas I wish to bring to your attention
1) Buy to let Mortgages
The mortgage interest on buy to lets will be restricted to 20% tax relief from next year. This could affect a lot of my clients and may be important if you are thinking of buying a new property.
2) 10% Wear and Tear
Wear and tear allowances on furnished lettings of 10% to be replaced. It will probably be replaced with actual spend.
The tax on these is to be reformed with a £5,000 tax-free allowance and then taxed from 7 1/2% thereafter. This will impact most of us who have a limited company from April 2016. I suspect the tax cost will catch up with us all in January 2018. I will be keeping my eye on this one but at the moment I suspect little can be done about the tax cost.
Direct recovery of debts
HMRC will have the power to recover debts of more than £1,000 from company bank accounts from those who are persistent Non payers. Welcome to Big Brother!
There are several other changes to inheritance tax, business allowances etc – too many to mention in a short newsletter. If you see an article which you believe may affect your Tax bill please email it to me and I will look into it for you. As always please call or email me before taking new action as it is much easier for me to advise you before the event.