When is the pre-budget 2015 Autumn Statement?

Wednesday 3rd December. George Osborne will take to the stage at around 12.30 after Prime Minister’s questions.

Here are our predictions for George Osborne’s Autumn Statement:

Stamp duty: Is it time for major reform to how we tax property?

Spiralling house prices and other fundamental problems in the housing market is a major political issue that the Chancellor needs to address.

Stamp duty acts as a further barrier to first-time buyers and its slab structure causes signifincant distortions. The Conservatives are opposed to a Mansion Tax, but home owners and prospective buyers should be prepared for a far-reaching announcement about how private residences are taxed.

All UK homeowners could potentially be affected, as well as non-UK residents who own property.

Alongside tax, it’s thought the Chancellor could make a host of planning measures designed to address  the housing shortage. This will include whether to make the existing temporary right to convert offices to homes without planning permission permanent.

Will there be more changes to the pension reforms proposed in the Budget?

Pensions Minister Steve Webb has been hinting at more pension regulations to come, according to Hargreaves Lansdown. But changes are likely to be minor, following the huge changes to pensions announced at the Budget and the short amount of time before the General Election.

There may be additional tax restrictions introduced on pension contributions, which could have a knock-one effect on the cost of pensions contributions for those paying tax at the higher and additional rates of income tax, predicts tax experts at Baker Tilly.

Savings

After increasing annual ISA limits in this year’s Budget, there’s speculation that a lifetime cap on the total amount that can be invested in the tax-free savings accounts may be introduced.

National Savings & Investments Income Bonds for the over-65s go on sale in January, so we can expect details of interest rates. Rates proposed in the Budget were market beating, 2.8% for the one-year and 4% for the three-year, points out Hargreaves Lansdown.

Inheritance tax

The inheritance tax-band is long overdue an increase, so it’s thought the Chancellor will address the issue on Wednesday. Baker Tilly believes it could be increased to as much as £1million from its current £325,000 per person, as the Chancellor tries to butter up his core voters in middle England.

Devolution powers

Following the Scottish referendum, George Osborne will update on promised devolution of powers. This will probably go with announcements on greater power bestowed upon English and Welsh cities.

“In the wake of the Scottish devolution package, we expect to hear plans for increased opportunities for cities across England as George Osborne seeks to drive stronger economic growth in the regions through greater decentralisation of housing, transport and economic development budgets,” said Miles Gibson, head of UK research, CBRE.

Tax, tax and more tax

Tax avoidance continues to fall under the microscope, so further announcements designed at closing schemes and loopholes that allow companies and individuals to wriggle out of paying their fair share can be expected.

This could mean the introduction of a strict criminal liability power for offshore tax irregularities, and more powers to HMRC to enhance their civil powers for tackling offshore tax evasion, according to Baker Tilly.

Immigration

Another large political issue, which means that a taxation of non-UK residents could also be announced, as well as the possibility of a restriction on non-UK residents’ ability to claim the UK personal allowance, said Baker Tilly.

Small business

The No.10 policy unit has been looking for new ways to stimulate investment in start-ups and micro-employers. A tax break to stimulate investment into new businesses, or perhaps to stimulate employee share ownership could be a strong political card to play, explains Hargreaves Lansdown.

“An expansion of the excellent Enterprise Investment Schemes would be a very good place to start. London is now a thriving, much-envied global hotbed for the finance and technology industries. With Government support, other cities, particularly Manchester, Birmingham and Leeds, are well positioned to become established global hubs for growing industries too,” said Nick Hungerford chief executive at investing platform Nutmeg.

The successful Seed Enterprise Investment Schemes is scheduled to come to an end in 2015, it offers tax relief to individual investors who purchase new shares in small, early-stage companies.

“We would welcome a five year extension to tie-in with the next Parliament, avoiding political uncertainty. We would like to see an increase to the individual investor limit to £150k and company raised investment to £250k, demonstrating The Treasury’s support for entrepreneurial start-ups,” said Simon Blowey, divisional director at Brewin Dolphin.”

Big business

The Chancellor is pro-business with low corporation taxes and reliefs aimed at supporting economic growth, so ther could be further plans along these lines.

There could also be an announcement of a reduced VAT rate applied to restaurant and catering, hotel accommodation and admissions to amusement parks, concerts and other cultural events, speculates Baker Tilly.

The Economy

The Office for Budgetary Responsibility will also publish its latest economic forecasts and will be announced as part of the statement. Any significant revisions to performance data or projections could have knock-on implications for monetary or fiscal expectations.