1st April 2015

A host of new tax changes affecting businesses and individuals have come into effect on 1 April. Here is a quick breakdown of the changes and how they may affect you.

Corporation tax

All companies will now pay a main rate of corporation tax of 20% on profits of £300,000 and under. Corporation tax will effectively become a single rate as the main rate is reduced to the current small companies rate of 20%.

VAT

The threshold for compulsory VAT registration is increasing from £81,000 to £82,000. The turnover limit for when businesses can deregister from VAT also is rising from £79,000 to £80,000.

Scottish Land and Buildings Transaction Tax

The Land Buildings and Transaction Tax (LBTT) will replace stamp duty in Scotland and is likely to apply to most property transactions. The obligation for collecting this tax has moved from HMRC to the new tax authority Revenue Scotland.

The 2015/16 residential and commercial rates:

Band Residential Band Non-residential
Up to £145,000  0% Up to £150,000  0% 
£145,001 to £250,000  2%  £150,001 to £350,000  3% 
£250,001 to £325,000  5%  Over £350,000  4.5% 
£325,001 to £750,000  10%  N/A  N/A 
Over £750,000  12%  N/A  N/A 

Air passenger duty

The 2 most expensive bands of air passenger duty (APD) have been abolished. Band C (for people travelling over 4,000 miles) and band D (over 6,000 miles) are being merged into band B. All passengers travelling over 2,000 miles will now pay £71 in APD. This compares to the £85 charge for band C and £97 charge for band D in the 2014/15 tax year.

Diverted profits tax

There is also a new tax on diverted profits that will see multinationals charged 25% on all profits artificially diverted overseas. The government hopes that this tax will help to limit the large-scale tax evasion that some high profile companies are currently undertaking with regards to their UK operations.

Contact us to discuss how these changes affect your business and personal financial planning.