The 2014 Finance Bill - Personal tax

Rates and allowances
  • Personal allowance to be £10,000 for 2014/15 and £10,500 for 2015/16.
  • Basic rate limit to be £31,865 for 2014/15 and £31,785 for 2015/16.
  • From 2015/16 indexed income tax limits and allowances to be linked to the CPI rather than the RPI.
  • 10% of personal allowance transferable between spouses or civil partners from 2015/16 (not higher or additional rate taxpayers).
  • From 2015/16 10% starting rate for savings reduced to 0% and limit on income to which the rate applies increased to £5,000 (from £2,880 in 2014/15).
  • Capital gains tax (CGT) annual exempt amount to be £11,000 for 2014/15 and £11,100 for 2015/16.
  • Technical changes as regards the application of the Scottish rate of income tax.

Capital gains tax
  • ‘Final period exemption’ for CGT main residence relief reduced from 36 months to 18 months (except for certain individuals who are disabled or in a care home).
  • Correction of a defect in the ‘split year’ residence rules for CGT.

Investment reliefs
  • New income tax relief (at 30%) and CGT relief for social investment.
  • Seed Enterprise Investment Scheme made permanent.
  • Changes to Venture Capital Trust (VCT) rules to prevent various abuses and permit investment via a nominee.
  • Exclusion from VCTs of activities qualifying for subsidies from the Department of Energy and Climate Change (to be introduced during the passage of the Bill through Parliament).
  • Income tax relief for interest on loans to buy an interest in a close company or employee-controlled company: extended to EEA companies.

  • Comptroller and Auditor General to prepare an annual report on the administration of the Scottish rate of income tax.
  • Income tax relief for non-resident competitors at Glasgow (athletics) Grand Prix 2014 and power to introduce exemption for similar events by statutory instrument.