UK Autumn Statement 2016: Business as usual

Ahead of the new Chancellor Philip Hammond’s announcements on 23 November 2016, some of our international clients with UK operations asked us what tax changes might be announced in the Autumn Budget post-Brexit and as anticipated, it is still very much a case of ‘business as usual’.

Corporation Tax

No further changes to the rate of corporation tax were announced. Despite expectations of a cut (potentially to as low as 15%) the rate will drop, as previously announced, to 19% from April 2017 and 17% from 2020.

Interest Deductibility

The Chancellor also confirmed that proposed changes to the deductibility of interest will take effect from April 2017 to reduce the amount of interest that can be deducted for Corporation Tax purposes (where net interest exceeds £2m) to 30% of Tax EBITDA or the group interest to EBITDA ratio, if more favourable.

Loss Relief

Similarly, the UK loss relief rules will change as planned, on the same date, to allow more flexible uses for losses generated after April 2017, although there are restrictions on the use of brought forward losses. Full legislation for both will be released in due course.

For more information or to find out how the changes might impact your business, contact a representative below:

Carla Graves
Director
+44 (0)20 7430 5936
cgraves@fitzandlaw.com

Mark Dent
Manager
+44 (0)20 7430 5960
mdent@fitzandlaw.com

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