UK Autumn Budget - Does This Affect You?

This blog post is designed to inform British-domiciled expatriates and those returning to (or connected with) the UK of the recent changes in the Autumn budget. The following are some key points:

• Tax rates for Income Tax, Capital Gain Tax (CGT) or Inheritance Tax (IHT) remained unchanged.  
• The personal income tax allowance; basic rate (£12,570), and higher rate limits (£37,700 & £150,000) have been frozen until April 2026. This means there should be an increase in Government tax receipts.
• Similarly, the IHT nil rate band, CGT annual exemption, and pension lifetime allowance are frozen until April 2026, should see an increase in tax receipts.
• The CGT reporting and payment window following the sale of UK residential property has been extended from 30 to 60 days. The change comes into effect for sales on or after 27 October 2021.

HM Revenue & Customs (HMRC) have recently revealed that IHT receipts from April to September 2021 were £3.1billion, £700million higher than in the same period a year earlier. 

HMRC have also been given more powers to clamp down on mass-market tax scheme avoidance promoters. The changes will contain four measures intended to make it difficult or impossible for organizations to promote these schemes.
 
One potential way to plan for UK inheritance tax mitigation is the use of accepted trust structures which hold client assets and are not viewed as being tax avoidance schemes by HMRC. Although these may be effective in the mitigation of UK inheritance tax, they may not act similarly in other jurisdictions where an individual's estate may be subject to local estate duties.