February 2020 / United Kingdom

HM Treasury announced on 30 January 2020 that individuals will enjoy an overall reduction to their tax burden effective April 2020 (2020/21). The changes will be implemented by way of the following statutory instruments laid on 30 January 2020:

The Social Security (Contributions) (Rates, Limits and Thresholds Amendments and National Insurance Funds Payments) Regulations 2020

These Regulations increase the following thresholds:

• Class 2: self-employed persons pay a flat rate of GBP 3.05 per week. Individuals whose earnings do not exceed the Small Profits Threshold of GBP 6,475 are exempt from charge;
• Class 3: individuals with earnings lower than GBP 15.30 per week may make a voluntary contribution to preserve their entitlement to the social security pension; and
• Class 4: the lower limit is GBP 9,500.

The Social Security Benefits Up-rating Order 2020

This Order increases the rates or amounts of:

• certain pensions and allowances under the Contributions and Benefits Act;
• certain benefits under the Pension Schemes Act; and
• certain pensions under Part 1 of the Pensions Act.

The Tax Credits, Child Benefit and Guardian's Allowance Up-rating Regulations 2020

These Regulations increase the:

• working tax credit; and
• child tax credit.

On 10 February 2020, the first reading of the Value Added Tax Bill 2019-20 was held in the House of Commons. The Bill proposes to:

• increase the maximum turnover threshold for exemption from the requirement to register for VAT; and
• exempt certain goods and services from liability to VAT.

The Taxation of Income from Land (Non-residents) (Amendment) Regulations 2020 (S.I. 2020/151) (the Regulations) were made on 13 February 2020 and will come into force on 9 March 2020. As reported at United Kingdom-3, News 30 October 2018, from 6 April 2020, non-UK resident companies that carry on a UK property business, or have other UK property income, will be subject to corporation tax rather than income tax. The Regulations were made to facilitate the above change.