Here we preview the major tax and finance changes due for 2017.
Although most of the changes don’t take place until April, now is the time to start planning as there may be opportunities to save tax.
It’s also worth remembering that some of the measures are currently passing through parliament and may therefore be subject to change.
The personal allowance will be £11,500 for 2017/18. The higher rate threshold will increase from £43,000 to £45,000. The higher rate threshold in Scotland is due to be £43,430.
The corporation tax rate will be 19% from 1 April 2017.
Anybody resident in the UK for more than 15 of the past 20 years will be deemed a UK domicile for tax purposes from 6 April 2017.
Auto-enrolment staging dates
Smaller businesses will continue to take start auto-enrolment in 2017. The process takes time so if your business is yet to begin the process, now is the time to start planning.
Property and trading income allowance
From 6 April 2017, there will be 2 new income tax allowances of £1,000 each for trading and property income. Individuals with trading income or property income below the level of the allowance will no longer need to declare or pay tax on that income.
Tax relief for residential landlords
Relief on finance costs, including mortgage interest payments, available to individual landlords of residential property will be restricted to the basic rate of tax.
This restriction will be phased in over a 4-year period, starting from April 2017.
The annual ISA saving limit will be £20,000 (or £4,128 for Junior ISAs) for 2017/18.
The Lifetime ISA, which is designed to help people save for retirement or a first home, will be launched in April 2017.
Making Tax Digital
The government will announce more detail about its plans to move to digital tax accounts in early 2017.
The residence nil-rate band of up to £100,000 per person will be introduced for 2017/18. This is set to increase in future tax years.