Chancellor Hammond's Spring Statement wasn’t expected to bring any major tax changes and it lived up to its expectations. The broad message was that the UK is doing okay, but if a no-deal Brexit becomes the reality then the economic outlook is pretty grim. On the other hand, a deal dividend will be delivered if an orderly exit deal can be reached. How much of the statement was a last-ditch attempt to get MPs to support the deal that’s on the table is anyone’s guess.   

Here are the key business announcements we feel you need to be aware of.

Making Tax Digital (MTD)

The focus will be on supporting businesses to transition to digital and the Government will not be mandating MTD for any new taxes or businesses in 2020. So mandatory digital record keeping for VAT that comes into effect on 1 April 2019 is all that will be in scope for digitisation in the foreseeable future.

Apprenticeship Levy

Budget 2018 announced that the co-investment rate will be halved from 10% to 5%, and the amount employers can transfer to their supply chains would increase to 25%. These changes will now take effect from April 2019.

Financial Services legislation 

To support the UK’s ambitions to remain open and competitive to businesses on leaving the EU, a period of consultation will be followed by legislation later this year.

Oil & Gas

A call for evidence around the offshore oil and gas decommissioning industry, seeking to assess what more can be done to strengthen Scotland and the wider UK as a global hub. 

Further clamp down on perceived tax avoidance 

Including a consultation on the measure announced in Budget 2018 to prevent abuse of the R&D tax relief for SMEs, with focus on how the measure will be applied to minimise any impact on genuine businesses.

Other business consultations announced 

• An operational review of Insurance Premium Tax. 

• Infrastructure Finance review, seeking views on how the government can best support private infrastructure investment in the context of the end of the European Investment Bank on the UK’s exit from the EU.

• A call for evidence on potential simplification and improvement to VAT Partial Exemption and Capital Goods Scheme.   

Preparing for a no-deal Brexit 

The Government this morning announced the temporary tariff regime that will apply for a period of 12 months from 29 March 2019 in the event of a no-deal Brexit. This is designed to minimise costs to businesses and consumers while protecting vulnerable industries, by ensuring the majority of imports will be duty free. If your business imports goods it’s important to review the tariff regime document on the Government's website to prepare now and find out if you are affected by this. Get in touch with your usual Johnston Carmichael adviser for assistance.   

Get in touch

If you any of these areas apply to your business, please get in touch with me Susie Walker at: Susie.Walker@jcca.co.uk or your usual Johnston Carmichael adviser to discuss further.