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Finance Bill 2014 (Draft Legislation)

Volume 572: debated on Tuesday 10 December 2013

The Government consulted on a number of tax policies, following their announcement at Budget 2013. Today, the Government are publishing responses to these consultations alongside draft legislation to be included in Finance Bill 2014. This fulfils our objective to confirm the majority of intended tax changes at least three months ahead of publication. Draft legislation will be open for technical consultation until 4 February 2014.

Details of the clauses published today are set out in the overview of legislation in draft document, which also includes tax information and impact notes for each measure. All publications will be available on the website.

The Government are publishing draft legislation on policies announced at Budget 2013 and earlier, including:

Completing the merger of the main corporation tax and small profits rates recommended by the Office of Tax Simplification.

An increase in the level of the income tax personal allowance to £10,000 from April 2014.

A package of measures to support employee ownership, including a capital gains tax relief and an annual exemption from income tax on bonus or equivalent payments paid to employees of those companies.

A remote gambling reform to move the taxation of remote gambling onto a place of consumption basis.

A social investment tax relief to encourage individuals to invest in social enterprises.

Changes to make film tax relief available at a rate of 25% on the first £20 million of qualifying production expenditure, and 20% thereafter, for small and large budget films.

Countering the disguising of employment relationships through the use of limited liability partnerships and the tax-motivated allocations of business profits where partners include both individuals and companies—mixed membership partnerships.

Abolishing the stamp duty reserve tax charge on unit trusts and open-ended investment companies in schedule 19 to the Finance Act 1999, with effect from 30 March 2014.

The Government will also publish draft legislation on policies announced in the 2013 autumn statement. This includes draft legislation to:

Introduce a transferable tax allowance for married couples.

Ensure that the reliefs introduced to support employee ownership work in the way that is intended. The corporate tax legislation will be amended to ensure that the exemption from income tax does not disqualify companies from claiming corporation tax relief on payments which would otherwise have qualified. Transfers of shares and other assets to an employee ownership trust will also be exempt from inheritance tax providing certain conditions are met.

Increase the maximum annual value of shares that an employee can acquire with tax advantages under the share incentive plans to £3,600 a year for “free” shares and to £1,800 a year for “partnership” shares.

Increase the rate of the bank levy set for 1 January 2014 to 0.156%, and make a number of changes to the bank levy’s detailed design following a 2013 review.

Prevent employment intermediaries being used to avoid employment taxes by disguising employment as self-employment.

Reduce the capital gains tax private residence relief final period exemption from 36 months to 18 months.