Plant and machinery - Annual Investment Allowance (AIA)

The AIA gives a 100% write-off on most types of plant and machinery costs, including integral features and long life assets but not cars, of up to £500,000 p.a. for expenditure incurred on or after 6 April 2014 (1 April 2014 for companies)). The £500,000 limit will reduce to £200,000 from 1 January 2016 and continue at this level until changed by subsequent legislation. Special rules apply to accounting periods straddling these dates.

Any plant and equipment acquisition costs in excess of these AIA limits will fall into the normal capital allowance pools: details set out below. The AIA may need to be shared between certain businesses under common ownership.

Other plant and machinery allowances

The annual rate of allowance is 18%. An 8% rate applies to expenditure incurred on integral features and on long life assets.

A 100% first year allowance may be available on certain energy efficient plant.

Cars

For expenditure incurred on cars, costs are generally allocated to one of the two plant and machinery pools. For expenditure incurred on or after 6 April 2013 (1 April 2013 for companies) cars with CO2 emissions not exceeding 130gm/km receive an 18% allowance p.a. Cars with CO2 emissions over 130gm/km receive an 8% allowance p.a.

*For higher and additional rate taxpayers

Entrepreneurs' Relief

The first £10m of qualifying gains are charged at 10%. Gains in excess of the limit are charged at the rates detailed above.

Company cars

• For diesel cars add a 3% supplement but maximum still 37%. 
• For cars registered before 1 January 1998 the charge is based on engine size. 
• The list price includes accessories and is not subject to an upper limit. 
• The list price is reduced for capital contributions made by the employee up to £5,000. 
• Special rules may apply to cars provided for disabled employees.

Car fuel benefit 2015/16

£22,100 x 'appropriate percentage'*

*Percentage used to calculate the taxable benefit of the car for which the fuel is provided. The charge is proportionately reduced if provision of private fuel ceases part way through the year. The fuel benefit is reduced to nil only if the employee pays for all private fuel.

Van benefit per vehicle 2015/16

• Van benefit £3,150
• Fuel benefit £594

The charges do not apply if a 'restricted private use condition' is met throughout the year.

The profits limits are reduced for accounting periods of less than 12 months and for a company with associated companies.

*Different rates apply for ring-fenced (broadly oil industry) profit.

From 1 April 2015 the main rate of corporation tax and the small companies rate converge and all companies are subject to tax at the same rate, 20%.

*Only applicable to dividends and savings income. The 0% (10%) rate is not available if taxable non-savings income exceeds £5,000 (£2,880).

Dividends are treated as the top slice of income and are taxed at 10%, 32.5% or 37.5% respectively, depending on the top rate of income tax paid during 2015-16.

Other income is taxed first, then savings income and finally dividends.

The Summer Budget 2015 introduced a Tax Lock. This specifies that, for the duration of this Parliament (until 2020), the basic, higher and additional rates of income tax will not increase above 20%, 40% and 45% for the duration of this Parliament. This will apply to earnings income in England, Wales and Northern Ireland and UK wide savings income.

**For those born after 5 April 1938, a basic rate taxpayer or non-taxpayer can transfer up to £1,060 of their personal allowance to a spouse or civil partner who is not a higher rate tax payer.

Surviving spouses or civil partners who die on or after 9 October 2007, and who do not fully utilise their nil-rate band of £325,000, can transfer any unused portion to the surviving spouse.

The additional main residence nil-rate band, introduced by the Summer Budget 2015, will not be available until April 2017. The proposed levels will be:

• £100,000 in 2017-18
• £125,000 in 2018-19
• £150,000 in 2019-20
• £175,000 in 2020-21

As for the main nil-rate band, any unused allowance on the death of the first spouse or civil part can be transferred to the surviving spouse.

These rates represent the maximum tax free mileage allowances for employees using their own vehicles for business. Any excess is taxable. If the employee receives less than the statutory rate, tax relief can be claimed on the difference.

For both years employers can claim a reduction in employers' contributions of up to £2,000 this Employment Allowance is due to increase to £3,000 from April 2016.

The Summer Budget 2015 introduced a Tax Lock. This specifies that, for the duration of this Parliament (until 2020), legislation will be introduced in a NICs Bill to set out that Class 1 NICs rates payable by employers and employees will not be increased beyond their 2015-16 levels.

2015/16 and 2014/15

• Tax relief available for personal contributions: higher of £3,600 (gross) or 100% of relevant earnings.
• Any contributions paid in excess of £40,000, whether personal or by the employer, may be subject to income tax on the individual.
• Where the £40,000 limit is not fully used it may be possible to carry the unused amount forward for three years.
• Employers will obtain tax relief on employer contributions if they are paid and made 'wholly and exclusively'. Tax relief for large contributions may be spread over several years.

SDLT is payable on land and property transactions in the UK.

Residential property

From 4 December 2014 onwards:

The SDLT rates are applied on a graduated basis with the portion of the purchase price within each tier charged at the applicable rate.

Non- residential for 2015/16 and 2014/15

The SDLT rates are applied on a graduated basis with the portion of the purchase price within each tier charged at the applicable rate.

From 1 April 2015 disposals of property in Scotland are subject to the Scotland Land and Buildings Transaction Tax.

Shares and securities

Rate - 0.5%

If only CTC is claimed, the threshold is £16,105 (£16,010) p.a. The family element of CTC tapers immediately after the child element at a rate of 41%.

The Summer Budget 2015 introduced a Tax Lock. This specifies that, for the duration of this Parliament (until 2020), the standard rate under section 2 of VATA can be no higher than 20% and that the reduced rate under section 29A can be no higher than 5%. The Tax Lock will also prevent supplies specified in Schedule 7A (reduced rate supplies) and Schedule 8 (zero rate supplies) from being removed from those schedules.