Moore member firm Kingston Smith has reviewed the UK government's Autumn Budget, which introduced key changes to Employee Ownership Trusts (EOTs) on 30 October 2024. The updates aim to ensure EOTs benefit employees and prevent tax avoidance. Key changes include restrictions on former owners retaining control, new trustee residency requirements, an extended period for CGT relief, and clearer rules on share valuations and distributions. Additionally, a tax-free bonus of up to £3,600 for employees of EOT-owned companies was introduced, with more inclusive participation rules. These reforms aim to strengthen employee ownership in the UK.

You can usually claim tax relief on private pension contributions worth up to 100% of your annual earnings, subject to the overriding limits. Tax relief is paid on pension contributions at the highest rate of income tax paid.

What is the Community Investment Tax Relief Scheme?
The Community Investment Tax Relief (CITR) scheme encourages investment in accredited intermediary organisations, called Community Development Finance Institutions (CDFIs). The tax relief under the system is available to both individuals and companies.

CDFIs may take a range of forms, including:
• Community loan funds, which make capital available to community regeneration initiatives and businesses;
• Micro-finance funds, which make small loans, usually at near-market rates of interest, to the smallest businesses, e.g., sole traders and
• Social banks - profit-seeking financial service providers or subsidiaries dedicated to social or environmental objectives.
 

What is the Community Investment Tax Relief Scheme?
The Community Investment Tax Relief (CITR) scheme encourages investment in accredited intermediary organisations, called Community Development Finance Institutions (CDFIs). The tax relief under the system is available to both individuals and companies.

CDFIs may take a range of forms, including:
• Community loan funds, which make capital available to community regeneration initiatives and businesses;
• Micro-finance funds, which make small loans, usually at near-market rates of interest, to the smallest businesses, e.g., sole traders and
• Social banks - profit-seeking financial service providers or subsidiaries dedicated to social or environmental objectives.
 

In general, there is no Capital Gains Tax (CGT) on a property which has been used as a main family residence. An investment property which has never been used will not qualify. This relief from CGT is commonly known as private residence relief.

HMRC's Latest Update: Noteworthy Additions and Modifications to Approved Professional Bodies List

Many professionals such as accountants, lawyers and health professionals are required to make a subscription to a professional body or learned society. HMRC has recently published an updated list of the organisations that they will accept as valid professional bodies.

What can businesses cheer about from the October 2021 budget? The Chancellor’s speech to parliament on 27 October was a very small yet mixed bag of announcements.

Expenditure on business entertainment is not allowable as a deduction against profits. Nor may a deduction be made for any expenditure which is incidental to business entertainment. Spending on rewarding staff for good work or to raise morale is classed as employee entertainment which will be eligible for tax relief and you will be able to reclaim VAT on. 

For many years Chancellors have threatened to reduce the Income Tax relief that can be claimed for payments into a private pension scheme.

Follow the outline below to ensure that the cost of your annual staff party will not create tax issues for you or your staff.

If you rent out all or part of your home this may create a Capital Gains Tax (CGT) charge when you sell the property.

HMRC is writing to charities to inform them of the latest changes to VAT relief on social media advertising. 

From 2015/16 the Marriage Allowance was introduced for married couples and civil partnerships. This allows one spouse to transfer 10% of their personal allowance to their partner - reducing their tax by up to £230.