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With one month to go until the Chancellor unveils his Autumn Budget, there have already been a few surprises let out of the bag. But what else might the Chancellor have in store?

Here, some of the Claritas Team take a look in their crystal ball to make some predictions on Rishi’s Autumn Delights.

Cass Graham, Senior Manager OMB tax

We were all prepared for some likely CGT changes in the last Budget following the Office for Tax Simplification’s (OTS) CGT Review but given the recent silence in relation to CGT it is ripe for attack. I think this will include the potential abolition of reliefs like Investors Relief (maybe even BADR for anything other than genuine retirement – dare I say it!), reduction of the annual exemption down to an administration amount and rate increases.

The Chancellor may also target Employment Related Securities (ERS), where employees get shares from their employing company with the potential to charge any gain arising on ERS shares to income tax not CGT. Given how wide ERS issues reach, this would be a huge problem.

Given the trend of the last couple of budgets I’d say that the biggest risk with these (and any changes announced) is the immediate effect they may have as they have tended to bring in measures effective as at the date of the budget with accompanying anti-avoidance measures too to prevent abuse.


Guy Kendall, Associate Partner, Corporate and Transactions TaxGuy-Kendall

While the economy is recovering from Covid I think it is likely the Chancellor will probably still include business reliefs to encourage investment so perhaps another extension of the £1m AIA limit past December for another year. However, this may be dependent on the success of the super-deduction that was brought in because in reality the application of that was more restrictive than originally perceived. Another tax rise where the PR is effective at disguising the actual benefit to taxpayers.

Like Cass, I think employee shares could be a focus, but genuine employee ownership is a Government target and good for growth. While EMI schemes are an effective and tax friendly way of remunerating employees for smaller private companies, perhaps we will see a wider consultation on future structure of employee share schemes generally , with a review of those schemes that are less advantageous with a view to improving their attractiveness.

However, the Chancellor does need to stimulate the economy and get money flowing into companies, encouraging growth and investment, so perhaps we will see an expansion of venture capital reliefs  such as EIS or VCT. This would also be relatively easy to do, by increasing the rate of relief or by increasing the maximum amounts that can be invested.

Finally, as a left field prediction, perhaps Rishi could abolish business rates  entirely… but recoup the cash by increasing VAT instead. While this is highly unlikely to happen, it would be a way of catching those tech companies with no shops and supporting those physical shops that have survived the last 18 months.


Matt Hodgson, Partner, Manchester Claritas - Matthew Hodgson

The rumour-mill continues unabated with regard to a potential CGT rate rise announcement in the forthcoming Autumn Statement, which seems more likely given the recently-announced increases in national insurance contributions for both employees and employers and dividend tax rates – a clear signal that tax increases will form a big part of the post COVID world.

In all likelihood, any CGT rate rise won’t be effective until 5 April 2022.

As Cass said, there’s also the other rumour about the complete repeal of ‘Business Asset Disposal Relief’ (BADR, formerly Entrepreneur’s Relief).  Unlike a CGT rate rise, this is something which could cease with immediate effect in Autumn, but we’d like to think the Treasury are sensible enough to replace it with another mechanism for rewarding Entrepreneur’s for building businesses and creating employment – maybe we’ll see the return of Retirement Relief for those of us old enough to remember it.


Sam Hart, Associate Partner, Private Client TaxSam Hart Colour

While we all breathed a sigh of relief in March, few people actually thought CGT was off the hook, and we have very much seen this as a stay of execution. I do think there will be some changes to CGT, although as Boris said when announcing his new Heath and Social Care tax, CGT just isn’t big enough by itself to bring in sufficient cash.

That said, while CGT rates may rise, although probably not as high as income tax rates, one easy win for the Chancellor would be to remove the tax-free CGT uplift on death where the assets benefit from an IHT exemption. While we are used to occasions of double charge in tax, this is the rare situation where there is a double relief, and its removal would therefore be easy to spin politically. While this would affect those with assets qualifying for the valuable Business and Agricultural Reliefs, it may also catch those benefitting from spousal exemption, which, as you can imagine, is rather a lot of people.

Talking of business and agricultural reliefs, while their complete abolition would be a bold move, an easier move would be the alignment of the ‘trading’ requirement between IHT and CGT in the name of simplification. However, it is almost inconceivable that this would mean the requirement comes down to the 51% IHT test, and highly likely that the tougher 80% trading requirement for CGT would apply to both. For agricultural property, the ability to claim the relief when not actually engaging in farming activity personally may also be reviewed.

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