Tax changes in the 2011 Autumn Statement

We had the Autumn statement yesterday, and in terms of tax changes that could affect our members there's nothing really significant - at least not yet. The main changes are below. New Investment Relief They've previously announced that Enterprise Investment Relief ('EIS') and Venture Capital Trust ('VCT') relief are to be amended. In line with this they're going to introduce a new Seed Enterprise Investment Scheme (SEIS) from April 2012. This will provide income tax relief of 50 per cent for individuals who invest in shares in qualifying companies, with an annual investment limit for individuals of £100,000 and cumulative investment limit for companies of £150,000. In addition there will also be a CGT exemption for gains made in 2012/2013 where the proceeds are invested in a SEIS in 2012/2013. We've not got any further details yet but if it provides for a complete CGT exemption (unlike the deferral under the current EIS relief) on any assets it could prove very valuable when the 50% income tax relief is also taken into account. They will also simplify the EIS by relaxing the connected person rules and the definition of shares that qualify for relief. Corporation Tax Rates The small company rate of corporation tax is 20% (for companies with <£300,000 of profits). The main corporation tax rate is currently 26%. This will fall in April again to 25 per cent and by 2014 it will reach 23 per cent - the lowest rate in the G7 and one of the lowest rates in the G20. Still some way off the rates in the IOM, Jersey, Cyprus and Irelands though. They've also announced they will publish further details of the Patent Box and of its reform of the Controlled Foreign Company rules on 6 December. 100% capital allowances They will make 100 per cent capital allowances available in the Black Country, Humber, Liverpool, North Eastern, Sheffield, and Tees Valley Enterprise Zones; CGT annual exemption frozen The CGT annual exemption for 2012/2013 will be frozen at the 2011/2012 amount (£10,600).