23rd November 2016 at 6:13pm
Today’s Autumn Statement was the last, as Autumn 2017 will see the Budget being held at this time of year in future.
This final Autumn Statement delivered few big surprises for charities, although across a range of sectors and taxes there were targeted announcements which will impact charities in different ways. Here’s a summary of the main developments.
Rough sleeping fund
A further £10 million was committed over two years to this fund, doubling its size, to prevent and reduce rough sleeping, particularly in London.
Museums and galleries tax relief
From 1 April 2017, tax relief will be expanded for museums and galleries beyond temporary exhibitions, to include permanent ones. The rates of relief will be set at 25% for touring exhibitions and 20% for non-touring exhibitions and the relief will be capped at £500,000 of qualifying expenditure per exhibition. I’ll return to this in a future blog to illustrate this in a case study, once details of the rules have been published.
Supporting the arts
An announcement was also made about government support for the new Studio 144 arts complex in Southampton, a new creative media centre in Plymouth and a Royal Society of the Arts pilot to promote cultural education in schools.
Tampon Tax Fund for women’s charities
Comic Relief is being awarded £3 million to distribute to a range of women’s charities. From 1 December 2016 the government is also inviting applications for the next round of Tampon Tax funding to support women’s charities.
£102 million of banking fines going to charities
More than 100 projects supporting armed forces personnel, their families and veterans; emergency service personnel; air ambulance charities; children’s hospitals and museums and memorials will benefit from this money over the next four years.
Insurance Premium Tax to increase
Charities will find a tax increase in their insurance premiums from 10% to 12% from 1 June 2017.
City deals in Scotland
Charities and social enterprises operating in Scotland may see opportunities arising from the range of city deals announced or already underway. A new city deal for Stirling was announced and the government said it will consider proposals for a deal with the Tay cities once they are brought forward. It may be that charities or social enterprises benefit from partnership working in these deals, for example on employment or skills-related projects.
Preserving a specific heritage asset
£7.6 million will be provided for repairs at Wentworth Woodhouse, if a sustainable business case is approved for the Grade I listed country house.
To counter-act the social and financial risks of high-interest rate lending, from 2018 the government will expand an existing scheme which incentivises credit union membership in ‘at risk’ communities. This will use funds recovered under the Proceeds of Crime Act from convicted ‘loan sharks’.
VAT relief on adapted cars for wheelchair users
The government has stated it wants to continue to provide help for wheelchair users, while tacking abuse of the legislation which gives a zero VAT rate on adapted motor vehicles – details are awaited.
Inheritance tax update
The forecasts announced for annual inheritance tax receipts show the anticipated sum to be £5.7 billion by tax year 2021/22. This is double the level of inheritance tax paid in 2008/9. Against this background, the role of inheritance tax exemptions becomes more relevant. More and more individuals are leaving money to charity in their will, which is exempt from this tax. Figures show around 7,500 estates claimed this exemption in 2010/11 rising to almost 9,000 estates in 2013/14. Charities will no doubt continue to focus on developing this aspect of their income.
For other updates on Autumn Statement 2016, keep an eye on the moneyplus blog.
The information in this blog or any response to comments should not be regarded as financial advice. Laws and tax rules may change in the future. Standard Life is not responsible for the content of external websites. The information here is based on our understanding on 23rd November 2016.