The UK 2013 Budget Report summarizes key points from the UK's 2013 budget including: - GDP growth expectations from 2013 to 2017 ranging from 0.6% to 2.8% annually - Public sector net debt as a percentage of GDP expected to rise from 75.9% to 85.6% over the same period - Corporate tax rates to be reduced from 23% to 21% and eventually a single 20% rate for all profits by 2015-16 - Individual tax allowances to increase annually through 2014 - Capital gains tax holiday to be extended and employment allowance for employer national insurance contributions introduced.

1. UK 2013 Budget Report
Presented by
Robert Whittall – Dyke Yaxley, LLC
and
Ian Brander – Dyke Yaxley, Limited

2. 2013 Budget Review

3. Contents
• Review of Debt and Growth
• Budget Review for Corporations
• Budget Review for Individuals
• Pot Pourri of UK/US tax issues
• Questions?

4. Growth and Debt
Growth of GDP
• Expectations for forthcoming years
− 2013 – 0.6%
− 2014 – 1.8%
− 2015 – 2.3%
− 2016 – 2.7%
− 2017 – 2.8%

5. Growth and Debt
Public Sector Net Debt as % of GDP
• Expectations for forthcoming years
− 2013 – 75.9%
− 2014 – 79.2%
− 2015 – 82.6%
− 2016 – 85.1%
− 2017 – 85.6%

6. Business 2013-14
Rates of corporate taxes and allowances from 1 April 2013
• Main Rate
− Profits over £1,500,000
− Taxed at 23%
• Small Business Rate
− Profits under £300,000 GBP
− Taxed at 20%

7. Business 2013-14
Capital allowances (Annual Investment Allowance)
• Increased from 1 April 2013
− Old Rate £25,000
− New Rate £250,000 (Capped for two years)
• Writing Down Allowance (Plant and Machinery)
− 18% Relief

8. Business 2014-15
Rates of corporate taxes and allowances from 1 April 2014
• Main Rate
− Profits over £1,500,000
− Reduced to 21%
• Small Business Rate
− Profits under £300,000
− Remaining at 20%

9. Business 2015-16
Rates of corporate taxes and allowances from 1 April 2015
• Government scrapped the Upper Limit of Tax
• All profits to be taxed at 20%
Employment Allowance for Employer NIC
• First £2,000 off National Insurance bill
• Available for every Company in the UK

10. Individuals
Allowances
• Personal Allowance
− Increased to £9,440 from 6 April 2013
− Increased to £10,000 from 6 April 2014
• Capital Gains
− CGT Holiday is to be extended

11. What were they thinking…

12. Something you can leave with
Why does the UK Tax Year run from April 6th to April 5th?

13. Something you can leave with
Why does the UK have a quirky tax year?
In 1582 Pope Gregory XIII ordered a change from the Julian calendar to the
Georgian calendar.
However due to other disagreements with the Catholic Church the UK decided
not to follow the rest of Europe and carried on with the Julian calendar for the
next 170 years.
Until 1752 when they realised they would have to catch up with the rest of the
world and align their calendar. So in September 1752 the days went September
2nd immediately followed by September 14th

14. Something you can leave with
In the UK the four main Christian Holidays had been used as the Quarter days
for businesses and so 25th March was the year end of a business.
Concerned by loss of revenue the Treasury said the tax year still had to be 365
days so business year ends moved to 5th April and in 1800 the Treasury added
an additional 1 day to take into account a lost leap year. Finally getting us to 6th
April.

15. Tax Pot Pourri
• US limited liability Companies
• UK Pensions
• 25% Tax-free
• UK Units Trusts
• UK SIP’s
• UK ISA’s

16. Tax Pot Pourri
• Sale of UK house & payoff of UK mortgage
• US income tax residency versus US “tax compliance” residency
• FBAR versus Form 8938
• Foreign pensions
• Life insurance
• Rental agreement
• Mortgage endowments

17. Legal Disclaimer
The informal comments and the information presented in these slides should
not be construed as constituting tax advice applicable to any specific taxpayer
because each taxpayer’s facts are different
To ensure compliance with requirements imposed by the IRS, we inform you
that any U.S. tax advice mentioned in the presentation or contained in these
slides is not intended or written to be used, and cannot be used, for the
purpose of (i) avoiding penalties under the Internal Revenue Code or (ii)
promoting, marketing or recommending to another party any transactions or
matters addressed herein.