Corporate capital loss restriction. From April 2020, corporate bodies will only be able to use carried forward capital losses in the amount of 50% of the annual capital gains.

Off payroll working rules. The off payroll working rules will be extended to include medium and large private organisations from April 2020. The onus will be on the organisations to determine whether PAYE should be applied to the fees paid to their contractors. HMRC will be providing further guidance and support for affected businesses in due course.

Private residence relief. The final exemption period of 18 months for capital gains tax (CGT) on an individual’s main home is being cut to just nine months. Lettings relief is also being reformed so that it is only available where a landlord occupies the property at the same time as the tenant.

CGT relief for loans to traders and share loss relief. Both reliefs are being extended to include businesses that are trading outside of the UK.

Digital services tax. From 1 April 2020 the government will introduce a digital services tax at a rate of 2% on revenues from groups that provide an online social media platform, marketplace or search engine to UK users. Only groups with over £25m of revenue from UK users will be affected. The measure will be in place temporarily, until a global solution has been reached.

What happens next? The clauses are open for consultation until 5 September. The 2020/21 tax rates and allowances will be set during Budget 2019 and further amendments to the legislation are likely to be made.

The draft legislation and supporting documents can be found here https://www.gov.uk/government/collections/finance-bill-2019-20.

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