What was missing from the Chancellor’s autumn statement?

3 mins

Posted on 26 Nov 2015

The Chancellor gave his spending review and autumn statement on 25 November 2015 but there were a couple of notable omissions.

We were expecting an announcement on changes to the taxation of termination payments. The Government consulted this summer on proposals to simplify the taxation of termination payments and align the treatment of income tax and National Insurance Contributions. It indicated in that consultation that it expected to announce its final proposals in the autumn statement.

There were also a number of rumours in the media that there would be some sort of announcement on reform of the IR35 rules but again there was no mention of this in the Chancellor’s statement. The government issued a discussion document in July and said that if it does decide to proceed with reforming the rules, any proposals will undergo a full consultation. Watch this space.

So what was in the statement?

Salary sacrifice

The Government is concerned about the growth of salary sacrifice arrangements and is considering what action, if any, is necessary. No doubt we can expect to hear more on this in due course.

Apprenticeship levy

The apprenticeship levy, which is intended to create three million new apprenticeships by 2020, will come into effect in April 2017. Less than 2% of UK employers will pay the levy. It will be set at a rate of 0.5% of an employer’s pay bill. A £15,000 allowance for employers will mean that it will only be paid on employers’ pay bills over £3 million.


The Chancellor announced changes to the new tax-free childcare scheme which is coming into force in 2017. If either parent earns over £100,000, the family will not qualify (down from £150,000). Each parent will also have to earn a minimum weekly income equivalent to 16 hours (worked at the National Living Wage) in order to qualify (up from 8 hours). 

The entitlement to receive 30 hours free childcare for three and four years olds will also be extended to families where one parent is in work and the other parent is disabled or a carer. It will also be extended to families where a parent is off work on paid sickness or parental leave. 

Employment status review

The Chancellor announced that he is going to take forward the majority of the recommendations made by the Office for Tax Simplification in its review of employment status. The OTS report can be viewed here. Note that IR35 was outside the scope of the report.

Disguised remuneration

The Government will take action against those who continue to use disguised remuneration schemes and who have not paid their fair share of tax. It will also consider legislating to close down any further new schemes intended to avoid tax on earned income, with effect from 25 November 2015.

Employment intermediaries and travel and subsistence

The government plans to restrict tax relief for travel and subsistence expenses for workers engaged through an employment intermediary, such as an umbrella company or a personal service company. From 6 April 2016, the relief will be restricted for individuals working through personal service companies where the intermediaries legislation applies.

The articles published on this website, current at the date of publication, are for reference purposes only. They do not constitute legal advice and should not be relied upon as such. Specific legal advice about your own circumstances should always be sought separately before taking any action.

Back to top