Read KPMG’s coverage of the first Budget since Brexit.
Download our quick "on a page" guide which covers all the key measures from the 2020 UK Budget for businesses, employers and individuals.
Should you have any queries regarding the Budget, or any other tax matter, please contact a member of the team.
The new UK Chancellor’s first Budget was most noteworthy in two respects from a macroeconomic viewpoint, with many of the headlines surrounding the unveiling of plans to counter the disruption expected to be caused by coronavirus and the announcement of eye-watering public spending plans.
In terms of tax policy, significant new measures were fairly thin on the ground, albeit the impact of the reduction in the Entrepreneurs’ Relief lifetime allowance will be painfully felt by some.
From an Isle of Man perspective, perhaps of more significance was what was not announced. There had been strong speculation that major changes to the Inheritance Tax (“IHT”) regime were in the offing (such as the abolition of Business Property Relief), but no such changes saw the light of day. Many Manx residents will have possible exposures to IHT liabilities, for example if they are UK domiciled or own UK property so, given the nature of some of the rumours which had been circulating, no news here is good news.
One change that is set to (exclusively) affect non-UK residents, or at least those intending to purchase residential property in England or Northern Ireland, is the introduction of a 2% Stamp Duty Land Tax (“SDLT”) surcharge for purchases made on or after 1 April 2021. When combined with the existing 3% surcharge applying to second homes, an Isle of Man resident could be faced with a top rate of SDLT of 17%! Given the graduated nature of SDLT, such a rate would only apply to the proportion of the purchase price in excess of £1.5m (and thus only affect a privileged minority). However, the combined 5% surcharge on standard SDLT rates for non-UK residents buying a second home of any value will significantly increase the overall cost of such deals and might end up causing people to think twice . . .
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