The ISA Allowance has been frozen for 2023/24

The annual Investment Savings Account (ISA) allowance has been frozen once again for the 2023/24 tax year. By freezing it again, the allowance is being left at £20,000 for every individual – However there will be an increase in the amount businesses can access and use of the Seed Enterprise Investment Scheme (SEIS).

SEIS Increasing

Here are the SEIS increases you need to be aware of:

  • The business investment limit will increase from £150,000 to £250,000
  • The limit at the date of share issue on a business’ gross assets will increase from £200,000 to £350,000
  • The annual limits on how much much an individual can claim Income Tax and Capital Gains Tax re-investment relief will increase from £100,000 to £200,000
  • The limit of a business’ “New Qualifying Trade” will increase from 2 to 3 tears for the 2023/24 tax year.

Real Estate Investment Trust Amendments

Real Estate Investment Trusts (REITs) will also be experiencing some amendments which, by design, will to make them more competitive. If a REIT holds a commercial property which is worth more than £20m, the requirement for holding a minimum of 3 properties, will be removed as of the 1st of April 2023.

The rule that deems the sale of REITs within 3 years of being significantly developed is being amended so that it is seen to be outside the property rental business. This means the valuation used when calculating what constitutes a significant development, better reflects increases in property values.

The rules for deduction of tax from REIT property income distributions, paid to partnerships are also being amended. This will allow a REIT property income distribution to be paid partly gross and partly with tax withheld.

The customer experience for REITs is expected to improve because these amendments will reduce certain constraints and administrative burdens associated with the UK REIT regime, which may make investment in REITs more attractive for some investors.

Here’s a link to the official update about what has been introduced, changed or removed: Corporation Tax: Real Estate Investment Trusts (REITs) – GOV.UK

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