Second Finance Bill of 2017 (UK)

Details of measures to tackle tax avoidance and evasion and address various imbalances in the system dominate ‘Finance Bill: September 2017’ – a second Finance Bill published this year to provide details of proposals cut from the original 2017 Finance Bill because of pre-election purdah.

Measures to tackle avoidance/evasion include

  • new penalties for those who use tax avoidance schemes later defeated by HM Revenue & Customs
  • updated company interest rules to ensure big businesses cannot use excessive interest payments to reduce tax
  • changes to prevent individuals from using artificial schemes to avoid paying tax owed on their earnings

Measures to tackle imbalances in the tax system include

  • abolishing permanent non-dom status, so that those who have lived here for years pay tax in the same way as UK residents
  • reducing the dividend allowance from £5,000 to £2,000 from April 2018 to limit the difference in tax treatment between those who work through their own company and employees/self-employed
  • reducing the Money Purchase Annual Allowance from £10,000 to £4,000, to limit the extent pension savings can be recycled to get extra tax relief

Supporting documents for measures in the Bill are listed under three headings

  • notes on resolutions – which comprise updated explanatory notes on each of the 48 resolutions in the new Bill
  • updated draft legislation comprises technical adjustments and additions to policies that have already been announced. This section includes a list of provisions that will continue to apply from the start of 2017 to 2018 tax year or other point before the forthcom8injg bill is introduced
  • guidance on the passage of the Bill and associated documents

See our previous post on the first finance bill

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