Finance Bill 2017-19 runs to 674 pages and covers a raft of legislation which was left out of the first Finance Act of the year, which was severely truncated because of the snap election.

Measures included in the latest Bill cover the following:

• tax treatment of payment for the termination of employment;
• changes to prevent individuals from using artificial schemes to avoid paying the tax they owe on their earnings;
• provisions relating to a reduction in the money purchase annual allowance for pensions, down from £10,000 to £4000;
• changes to the rules regarding the tax treatment of non doms; 
• reducing the dividend allowance from £5,000 to £2,000 from April 2018;
• an update on the rules around company interest expenses, to ensure big businesses cannot use excessive interest payments to reduce the amount of tax they pay; 
• changes to the regime for charging inheritance tax on overseas properties with value attributable to residential property in the UK; and
• Making Tax Digital reporting for VAT.

There are also proposed new penalties for those who enable the use of tax avoidance schemes that are later defeated by HMRC and tougher rules on the use of artificial tax avoidance schemes.

John Cullinane, CIOT tax policy director, said: ‘The most significant measures in the Bill are probably changes to corporation tax and to the regime for non-UK domiciles. The two schedules on corporation tax loss relief and interest deductibility now run to 303 pages between them, not far off half the Bill on their own.

'The Bill also contains clauses paving the way for Making Tax Digital, substantial changes to the rules for fulfilment businesses and a range of anti-avoidance measures, including penalties for enablers of avoidance schemes.

‘Despite the pre-election Bill being split in two, the current Bill, assuming it is passed intact, will still be the second longest Finance Act ever.

'At 674 pages it will be beaten only by the 703 page Finance Act 2012. While much of the new legislation will only apply to larger businesses this will still represent a further complicating of the tax system, both by lengthening the code and through the process of change.

'Feedback from taxpayers indicates that the pace of change itself is one of the biggest factors in making the tax system complicated for its users.

‘With a Bill this long the scrutiny process will be particularly important.’

It is also worth noting that many of the measures were introduced in previous Budgets and are only now coming into force in this Finance Bill, for example interest deductibility rules and the plans to roll out Making Tax Digital online reporting for companies.

Mel Stride, financial secretary to the Treasury, said: ‘The UK is a world leader in tackling tax avoidance and evasion, but we must continue to take action to ensure everyone pays their fair share.

'The Finance Bill will allow us to do just that by preventing companies and individuals from using complicated tax structures to avoid paying the tax they owe, and penalising people that help them to do it.’

The Finance Bill (No.2) is here

Report by Pat Sweet