The UK’s Chancellor of the Exchequer, Philip Hammond, has today delivered his Spring Statement. Less formal or broad in scope than the Budget, which moved to the Autumn last year, this is not about announcements on tax or spending, but more about economic forecasts.
The Chancellor himself describes this as a ‘non event’ from a financial point of view but since 1975, the government has been legally obliged to produce its projections for the economy and the public finances twice a year. That’s why have a main budget and this lower key announcement.
The question for expats, as ever, is how does it affect us?
The good news is that there is very little in the Spring Statement that will affect many people as it is not about changes. Unlike the full Budget, this is a brief read and some of the salient points are as follows:
CGT private residence relief – A consultation on the changes announced at Budget 2018 to lettings relief and the final period exemption, which extends private residence relief in capital gains tax. This will be of interest to any expat who owns property in the UK.
Child Trust Funds (CTF): consultation on maturing CTFs – Draft regulations to ensure that CTF accounts can retain their tax-free status after maturity.
The Treasury will conduct a full spending review before the summer recess, to be concluded before the Autumn Budget, but this is on the assumption that a Brexit deal is agreed over the next few weeks and there is a reduction in the current economic uncertainty.
There has been an announcement that there will be a separate policy paper on tackling tax avoidance, evasion and other forms of non-compliance. There will also be a further updated strategy for offshore tax compliance, which demonstrates how serious this matter is taken. This is aimed largely at companies and wealthy individuals and in the past few years the Treasury has protected over £200 billion of tax that would otherwise have gone unpaid. Further steps will continue to be taken.
Overall, this is largely a non event from an perspective of most individuals and whilst the Statement includes a number of spending announcements, these are largely policy driven, or clarifications of previous announcements and policy statement and will not affect the average person, or the average expat.
What changes and announcements we will see in the Autumn Budget will no doubt be partly driven by what happens with Brexit and UK politics generally before the final quarter of 2019.
I write articles such as this one as part of the holistic personal financial planning service that I provide to expats. Should you have any queries on the Spring Statement, or any other financial planning issues, please do not hesitate to contact me at firstname.lastname@example.org
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