How this year’s Budget will affect professional firms
- For firms investing in IT or property refurbishments, the increase in the Annual Investment Allowance to £1 million for the two calendar years commencing 1 January 2019 will be welcome.
- The new Structures and Building Allowance will be of interest to those building their own offices or making structural changes to existing offices. The commencement date is in respect of works started on or after 29 October 2018. Although the rate is only 2% per annum, it is better than nothing (which has previously been the case).
- The tightening of the IR35 off-payroll worker rules will introduce increased liabilities and additional compliance burdens for some. However, the introduction is delayed until April 2020 and will only apply to medium and large sized firms. Read more.
Effects on partners
- There are no changes to the tax relief on pension contributions and Gift Aid payments.
- The Lifetime Allowance for pension savings is increasing to £1,055,000 from April 2019.
- Principal Private Residence Relief is changing and the final period of exemption will be nine months from April 2020.
- From April 2020 lettings relief will only apply for those where the owner is in “shared-occupancy”.
- The level of the personal allowance and the basic rate band that were proposed from April 2020 are being brought forward to April 2019.
Read more detail on these and other items that affect partners in professional firms and private clients.