As is traditional, the Chancellor's most exciting announcement came at the end of his speech. The proposed changes to the timing of the tax legislation process are welcome, although they will result in two Budgets next year and it remains to be seen how long the government will resist the temptation to use the Spring Statements from 2018 for new tax policy announcements.

However, this Autumn Statement was certainly light on substance for private client practitioners. Any hope that the government might take a little longer to work on changes to the taxation of non-domiciled individuals was dashed by confirmation that the changes will be included in the Finance Bill 2017. The phasing out of tax advantages of salary sacrifice was on the cards. Most other announcements simply confirmed policies already announced.

Charities have criticised the Chancellor for failing to support the sector. His statement included very little that was new specifically for charities, beyond the latest round of LIBOR fine funding and VAT refunds. Plans to extend museums and galleries tax relief to permanent exhibitions are welcome, as are proposals to expand the Social Investment Tax Relief scheme (although these fall short of the government’s 2014 proposals). Concern has been expressed about the impact that increases in insurance premium tax and the national living wage will have on charities’ operating costs.

With effect from autumn 2017, the government will move to a single major fiscal event, which will be the annual Budget. Accordingly, the annual Autumn Statement will be dropped, but the annual Budget will be held in the autumn rather than the spring. For 2017, which will be a transitional year, there will be a spring Budget and an autumn Budget.

This change is being made to limit the announcement of major tax changes to once a year. If this results in less frequent tax changes and a more stable tax system, taxpayers will welcome the move.

The change will alter the tax policy cycle and the legislative timetable for the Finance Bill. In 2017, there will, as usual, be a Finance Bill (draft clauses for which will be published on 5 December 2016: see Legal update: Draft Finance Bill 2017 clauses will be published on 5 December 2016) introduced in the spring with Royal Assent expected in the summer. From winter 2017, the Finance Bill will be introduced into Parliament following the autumn Budget, with Royal Assent expected in spring 2018.

Accordingly, after the transition to an autumn Budget, typically, new tax policy will be announced in the autumn Budget and consulted on in the spring, with a view to draft legislation being issued (for consultation) in the summer after the Budget. Those policy measures will then be included in the Finance Bill introduced after the following Budget.

Transitioning to the new timetable (in 2017) will require adjustments to the normal tax policy making process because of the shorter interval between the two 2017 Budgets. How this is done will be decided on policy-by-policy basis and involve, where possible, consultation on both policy proposals and draft legislation.

The Chancellor will make a Spring Statement responding to the updated Office for Budget Responsibility forecast for the economy and the public finances. However, the Chancellor has said that the government will reserve the right to make fiscal policy changes at the Spring Statement if the economic circumstances require it.

(See HM Treasury: Autumn Statement 2016, paragraphs 4.1-4.3) and HM Treasury: 7 things you need to know about the new Budget timetable.)

The government has confirmed its commitment to increase the income tax personal allowance to £12,500 and the higher rate threshold (the sum of the personal allowance and the basic rate limit) to £50,000 by 2020-21. It is unclear when this will be enacted.

The government has also confirmed that, in 2017-18, the personal allowance will rise to £11,500 and the higher rate threshold to £45,000.

Once the personal allowance reaches £12,500, the government has announced that it will rise in line with the Consumer Prices Index (CPI), like the higher rate threshold, rather than the national minimum wage (NMW). This represents a departure from legislation enacted in Finance (No. 2) Act 2015 to link the personal allowance to the NMW when it reaches at least £12,500 (see Private client tax legislation tracker 2014-15: Lifetime planning: Income tax: linking personal allowance to minimum wage). Again, it is unclear when this change will be enacted.

For tables of income tax rates and allowances, and links to more information about income tax, see Practice note, Tax data: income tax.

To track this measure, see Private client tax legislation tracker 2016-17: Lifetime planning: Income tax: personal allowance and higher rate limit.

(See HM Treasury: Autumn Statement 2016, paragraphs 4.5 and 4.6 and Executive summary; HM Treasury: Tax and tax credit rates and thresholds for 2017-18, section 1.6; and HM Treasury: Autumn Statement 2016: some of the things we've announced, paragraph 5.)

The government has announced that the starting rate limit for savings will remain at its current level of £5,000 for 2017-18.

This is the band of savings income that is subject to the 0% starting rate. Section 3 of the Finance Act 2014 reduced the starting rate to 0% and increased the limit to £5,000, with effect from 6 April 2015 (see Private client tax legislation tracker 2013-14: Lifetime planning: Income tax: starting rate for savings).

(See HM Treasury: Autumn Statement 2016, paragraph 4.19 and HM Treasury: Autumn Statement 2016: policy costings, page 41).

The government confirmed that, as announced in the 2016 Budget, it will introduce two new allowances that will exempt from tax the first £1,000 of an individual's trading and property incomes, and that where an individual's income falls below the threshold for the applicable allowance, there will be no requirement to declare the income for tax purposes.

Additionally, the government confirmed that the trading income allowance will also cover certain miscellaneous income from providing assets or services. As previously announced, the legislation will be in the Finance Bill 2017.

We are tracking the measure to implementation in Private client tax legislation tracker 2016-17: Income tax: trading and property allowances.

(See HM Treasury: Autumn Statement 2016, paragraph 4.14.)

As widely predicted, the government has confirmed that it is to limit the benefits that attract tax and NICs advantages when provided as part of a salary sacrifice arrangement. The benefits that can continue to benefit from tax and NICs relief if provided through salary sacrifice will be limited to:

The limitation will take effect from April 2017. However, arrangements in place before that date will be protected until April 2018 or for cars, accommodation and school fees, until April 2021.

HMRC's response document to its August 2016 salary sacrifice consultation together with draft Finance Bill 2017 legislation is expected on 5 December 2016.

For the background to this measure, see Private client tax legislation tracker 2016-17: Salary sacrifice restrictions.

For information about salary sacrifice arrangements, see Practice note, Salary sacrifice arrangements.

(See HM Treasury: Autumn Statement 2016, paragraph 4.13 and HM Treasury: Autumn Statement 2016: policy costings, page 21.)

The Chancellor has written to the Office of Tax Simplification (OTS) responding to the OTS' two reports on the alignment of income tax and NICs. For the OTS' first report, published in March 2016, see Legal update, OTS tax and NICs alignment review and for its second report, published in November 2016, see Legal update, OTS: Further report on alignment of tax and NICs.

The letter confirms the following:

The letter also outlines some of the simplification measures that the OTS proposed and that the government is implementing. These include the abolition of class 2 NICs and the alignment of the following:

For background and the OTS' proposals, see Private client tax legislation tracker 2016-17: Income tax: integration with NICs.

(See HM Treasury and Office of Tax Simplification, Correspondence between the Chancellor, Financial Secretary to the Treasury and the Office of Tax Simplification regarding recent OTS publications.)

The income tax and CGT reliefs associated with employee shareholder status (ESS) will be abolished for ESS shares acquired in consideration of an ESS agreement made on or after 1 December 2016 (except in circumstances where an employee received independent legal advice on the ESS agreement on 23 November, before 1.30 pm, in which case the effective date is 2 December 2016). For ESS arrangements entered into before 1 December 2016, the tax advantages will continue to apply.

Currently, ESS shares qualify for certain income tax and capital gains tax (CGT) reliefs, but the CGT relief was restricted, following the 2016 Budget, in relation to agreements entered into after 16 March 2016, to a lifetime allowance of £100,000. For more information on ESS, see Practice note, Employee shareholders.

The government notes that the measures to remove ESS tax advantages are in response to evidence that ESS is being used for tax planning.

ESS technically remains open for the time being, because the provisions to be included in Finance Bill 2017 do not amend the Employment Rights Act 1996 (ERA 1996). However, the government intends to close ESS to new users altogether (presumably by amending the ERA 1996) "at the earliest opportunity". However, without the associated tax reliefs, in our view it is very unlikely any new ESS arrangements will be implemented, as these were the main driver for implementing ESS arrangements.

Although it may have come as a surprise to some that ESS is being withdrawn altogether, the restriction of the CGT relief available for ESS shares earlier this year indicated the direction that the government might take in future over ESS.

(Income Tax and Capital Gains Tax: employee shareholder status; HM Treasury: Autumn Statement 2016, paragraph 4.31; HM Treasury: Autumn Statement 2016: policy costings, page 27 and Parliament.uk: House of Commons: Written Statement HCWS277, 23 November 2016 .)

The government has announced that, from Royal Assent to the Finance Bill 2017-18, inheritance tax (IHT) relief for gifts to political parties will be extended to parties with representatives in the devolved legislatures, as well as parties that have acquired representatives through by-elections. (We think the reference to the Finance Bill 2017-18 means the bill that will become the Finance Act 2018, but this is unclear.)

Gifts to UK political parties are exempt from IHT, provided that the party is of sufficient stature. For more information, see Practice note, Inheritance tax: overview: Exemptions available for both lifetime gifts and on death: Gifts to political parties.

For further guidance on the three devolved legislatures in the UK, see Practice note, Extent and devolution.

(See HM Treasury: Autumn Statement 2016, paragraph 4.16.)

The government has announced that the annual chargeable amount for the annual tax on enveloped dwellings (ATED) will rise in line with inflation for the 2017-18 chargeable period (which begins on 1 April 2017).

For more information about ATED, see Practice Note, Annual tax on enveloped dwellings (ATED).

(See HMRC: Autumn Statement 2016: tax updates and technical changes, paragraph 2.6.)

Following a consultation launched on 9 August 2016, the government has confirmed that legislation will be introduced to amend the rules concerning the allocation of partnership profits.

Partnerships are treated as transparent for most tax purposes and the activities of the partnership are, therefore, treated as carried on by the partners. Accordingly, partners are taxed separately on their share of the profits or losses of the partnership. The profits and losses of a partnership are, subject to certain provisions, allocated in accordance with the partnership's profit sharing agreement in force during the period of assessment. The consultation proposed that legislation should be introduced to confirm that, for tax purposes, profits will be allocated according to the profit-sharing arrangements set out in the partnership agreement, with this position being overridden if the profit shares change and the nominated partner notifies HMRC. The consultation also proposed that legislation should provide that the basis of the allocation of tax adjusted profits should be the same as the allocation of the accounting profit or loss between partners. (See Legal update, HMRC consults on changes to taxation of partnerships.)

The government has announced that the draft legislation amending the rules will be published for technical consultation. However, it is not indicated when this will be or whether it will be implemented in the Finance Bill 2017.

For more information on the allocation of partnership profits, see Practice note, Partnerships: allocation of profits and losses: tax. To track progress of this measure, see Private client tax legislation tracker 2016-17: Partnership taxation.

(See HM Treasury and HMRC: Autumn Statement 2016: tax updates and technical changes, paragraph 2.7.)

As announced in the 2016 Budget, the annual ISA allowance will rise from £15,240 to £20,000 from 6 April 2017.

The annual subscription limit for Junior ISAs and Child Trust Funds will rise in line with the consumer prices index to £4,128 from 6 April 2017.

For information about the tax treatment of ISAs and to follow future developments, see Practice note, Tax data: individual savings accounts and Private client tax legislation tracker 2016-17: ISA developments.

(See HM Treasury: Autumn Statement 2016, paragraph 4.18; HM Treasury: Autumn Statement 2016: policy costings, page 42; HM Treasury and HMRC: Autumn Statement 2016: tax updates and technical changes, paragraph 1.6 and HM Treasury: Tax and tax credit rates and thresholds for 2017-18, section 4.)

Pensions announcements in the Autumn Statement include a proposal to reduce the money purchase annual allowance (which effectively restricts tax relief available on further contributions to a defined contribution arrangement and is triggered when an individual flexibly accesses the pension) and a forthcoming consultation on technical changes to the UK tax treatment of foreign pensions.

The government has also confirmed that the planned removal of tax advantages for salary sacrifice arrangements will not apply in relation to pension contributions (see Salary sacrifice: restricted to certain benefits).

For full details, see Legal update, 2016 Autumn Statement: key pensions announcements.

For more information about the tax treatment of pensions, see Practice note, Tax data: registered pension schemes.

As announced in the 2016 Budget following a consultation published on 20 April 2016, the government has confirmed that that it will introduce legislation in the Finance Bill 2017 to prevent excessive tax charges arising on the part surrender and part assignment of life insurance policies.

The legislation will allow policy holders to make an application to HMRC to have the income tax charge recalculated on a just and reasonable basis.

To follow this development, see Private client tax legislation tracker 2016-17: Life insurance: part surrenders and assignments.

(See HM Treasury: Autumn Statement 2016: tax updates and technical changes, paragraph 1.4.)

The government has confirmed that it will introduce in the Finance Bill 2017 a power to amend the lists of assets that life insurance policyholders can invest in without giving rise to an annual tax charge under the personal portfolio bond legislation.

This measure was first announced in the 2016 Budget and follows a consultation during summer 2016. It will take effect on Royal Assent to the Finance Bill 2017.

For more information, including a link to the consultation, see Private client tax legislation tracker 2016-17: Life insurance: personal portfolio bonds.

(See HM Treasury and HMRC: Autumn Statement 2016: tax updates and technical changes, paragraph 1.5.)

Following an announcement in the 2016 Budget and a consultation launched on 9 August 2016, the government has confirmed that the Finance Bill 2017 and secondary legislation will clarify the rules concerning capital allowances, chargeable gains and investments by co-ownership authorised contractual schemes (ACSs) in offshore funds. The legislation will also include information reporting requirements on operators of co-ownership ACSs.

ACSs are regulated, UK domiciled vehicles established under the Collective Investment in Transferable Securities (Contractual Scheme) Regulations 2013 (SI 2013/1388). An ACS may be a co-ownership scheme or a limited partnership scheme. Both co-ownership and limited partnership ACSs are transparent for the purposes of the taxation of income. Limited partnership ACSs are transparent for the purposes of chargeable gains, but co-ownership ACSs are not.

The consultation sought views on measures to ensure that investors in ACSs are entitled to capital allowances due to uncertainty over whether allowances are available to co-ownership ACSs investors. Views were also sought on any additional improvements that could be made to the tax treatment of ACSs.

For more information on ACSs, see Practice note, Authorised contractual schemes: tax. To track progress of this measure, see Private client tax legislation tracker 2016-17: Authorised contractual schemes.

(See HM Treasury and HMRC: Autumn Statement 2016: tax updates and technical changes, paragraph 2.4.)

The government has announced that legislation will be introduced in the Finance Bill 2017 to amend the Enterprise Investment Scheme (EIS), Seed Enterprise Investment Scheme (SEIS) and Venture Capital Trust (VCT) scheme rules. The changes are stated to:

Draft legislation for these changes (together with an explanatory note and tax information and impact note) will be published on 5 December 2016.

The government also announced that it would not be changing the venture capital schemes rules to permit the use of replacement capital. (Replacement capital is the purchase of shares from existing shareholders.) The government had announced in the 2015 Autumn Statement that it would introduce this flexibility subject to obtaining state aid approval (see Private client tax legislation tracker 2016-17: Venture capital schemes).

In the July 2015 Budget, the government confirmed that a new online process for the submission of advance assurance applications would be available from the end of 2016. However, this has yet to materialise. The government has, however, announced that it will consult on options to streamline and prioritise the advance assurance service.

For information about the venture capital schemes, see:

(See HM Treasury and HMRC: Autumn Statement 2016: tax updates and technical changes, paragraph 2.8 and Parliament: Autumn Statement 2016: Measures with immediate effect: Written statement.)

As originally announced in the July 2015 Budget, followed by further announcements in the 2016 Budget and in a consultation published on 18 August 2016, the government has confirmed that measures will be implemented by the Finance Bill 2017 to provide new deemed domicile rules. These will have effect from 6 April 2017 to prevent UK-resident individuals from benefiting from permanent non-UK domiciled status.

It has also been confirmed that the previously announced inheritance tax charge on UK residential property owned indirectly by non-UK domiciled individuals will also be implemented by the Finance Bill 2017 to have effect from 6 April 2017.

Changes to business investment relief for non-UK domiciled individuals to make it easier for them to inwardly invest in UK businesses will also be introduced in April 2017 as previously announced. The government will also continue to consider further improvements to the relief rules.

The consultation published on 18 August 2016 included draft legislation for some of these measures but additional provisions will be included in draft legislation for the Finance Bill 2017 which will be published on 5 December 2016.

For more information, see Practice notes, Domicile, Residence, ordinary residence and domicile: UK tax implications, Remittance basis: what individuals need to know: overview and Taxation of offshore trusts: overview.

To follow this development, see Private client tax legislation tracker 2016-17: Permanent non-domiciled tax status abolished, IHT: UK residential property owned indirectly, Remittance basis: de minimis exemption and Remittance basis: business investment relief.

(See HM Treasury: Autumn Statement 2016, paragraph 4.15.)

The government has announced that it will introduce new measures in the Finance Bill 2017 to require taxpayers to correct past under-declarations of income and capital gains in relation to their offshore financial interests. Taxpayers will be required to disclose information to HMRC relating to the under-declared income and capital gains by 30 September 2018. The legislation will also provide for new tax-geared sanctions for those who fail to disclose within this time period.

The measure will have effect from Royal Assent to the Finance Bill 2017.

HMRC has used information from automatic exchange of information agreements, and its own compliance interventions and administrative data to identify under-declared income and gains from offshore financial interests. However, the likely tax yield from this measure is shown as having a very high level of uncertainty in the Office for Budget Responsibility's policy costings.

For more information and to track this measure, see Private client tax legislation tracker 2016-17: Offshore tax evasion: civil and criminal sanctions.

(See HM Treasury: Autumn Statement 2016, paragraph 4.53 and HM Treasury: Autumn Statement 2016: policy costings, pages 30-31 and paragraph B.12.)

The government has announced that it will consult on a new measure to require intermediaries arranging complex offshore structures to notify HMRC of both the structures and the clients.

There is no suggested timetable in the announcement and no indication of the likely form or scope of the requirement. However, it is likely that the proposal will be controversial, given that advisers are already concerned by the recent consultation and announcements on strengthening tax avoidance sanctions and deterrents.

For more information, see Strengthening tax avoidance sanctions and deterrents.

(See HM Treasury: Autumn Statement 2016, paragraph 4.54.)

The government has announced that it will consult, at the 2017 Budget, on a proposal to extend the corporation tax regime to all non-resident companies receiving taxable income from the UK.

The proposal appears to be driven by a desire to ensure that that all companies subject to UK taxation are brought within the same tax regime, and in particular, subject to new revenue-raising measures such as the reform of corporation tax loss relief and the new rules on the deductibility of corporate interest expense. It is unclear whether a motivation is to extend the territorial scope of corporation tax along the lines adopted for non-UK resident companies dealing in or developing UK land (as to which, see Practice note, Transactions in land: corporation tax: Territorial scope of corporation tax for UK land traders).

(See HM Treasury: Autumn Statement 2016, paragraph 4.26.)

Legislation will be introduced to provide that performance fees incurred by offshore reporting funds are not deductible when calculating an investor's liability to tax on income. However, such fees will reduce the tax payable on any gains realised on a disposal of an interest in the fund. This measure has not previously been announced or consulted on.

Investors in offshore reporting funds are liable to income tax or corporation tax on income on their share of the reported income of a reporting fund, regardless of whether it is distributed, and to tax on chargeable gains on a disposal of an interest in a reporting fund. Currently, performance fees may be deducted when calculating a reporting fund investor's liability to tax on income.

The proposed legislation will ensure that the tax treatment of performance fees incurred by offshore reporting funds and offshore non-reporting funds is the same. The measure will have effect from April 2017. However, it is not indicated whether or not the measure will be implemented in the Finance Bill 2017.

For more information on offshore funds, see Practice note, Offshore funds regime.

(See HM Treasury: Autumn Statement 2016, paragraph 4.32 and HM Treasury: Autumn Statement 2016: policy costings, pages 30 and 31.)

The government has announced that, from 6 April 2017, the amount of investment social enterprises up to seven years old can raise through social investment tax relief (SITR) will increase to £1.5 million.

It will also make changes to the SITR scheme as follows:

The government has said that it will undertake a review of SITR within two years of its enlargement.

In the 2014 Autumn Statement, the government announced its intention, subject to obtaining EU state aid clearance, to expand SITR by replacing the current investment restriction of £275,000 over a three-year period with a new annual investment limit of £5 million per organisation, subject to an overall limit of £15 million. The government has said that its current announcement replaces its 2014 Autumn Statement expansion plan "with a targeted expanded regime to run alongside the existing scheme".

For further information about SITR and the 2014 announcement, see Practice note, Social investment tax relief (SITR).

(See HM Treasury: Autumn Statement 2016, paragraph 4.34 and HM Treasury: Autumn Statement 2016: policy costings, page 38.)

The government has committed to use a further £102 million from fines imposed on banks over the next four years to support military and emergency services charities and other related good causes.

(See HM Treasury: Autumn Statement 2016, paragraph 5.14, Chancellor Philip Hammond's Autumn Statement 2016 speech and HM Treasury: Autumn Statement 2016: LIBOR commitments (23 November 2016).)

The government has announced that it will award £3 million from the tampon tax fund to Comic Relief to distribute to a range of women’s charities.

The fund was established following an announcement in the 2015 Autumn Statement (see Legal update, 2015 Autumn Statement and Spending Review: key private client announcements: VAT on sanitary products: women's charities fund).

The government will also invite women's charities (including those that run programmes tackling violence against women and girls) to bid for a further round of awards from the fund from 1 December 2016.

(See HM Treasury: Autumn Statement 2016, paragraph 5.15 and Chancellor Philip Hammond's Autumn Statement 2016 speech.)

The government has announced that it will broaden the scope of museums and galleries tax relief to include permanent as well as temporary and touring exhibitions.

The relief, which will enable museums and galleries to claim corporation tax relief on certain costs incurred in developing exhibitions, was first announced in the 2016 Budget and was the subject of a consultation that ran between 5 September and 28 October 2016.

The government has also announced that, in line with other creative sector reliefs, relief will be available for 80% of qualifying expenditure and that the rates of the payable tax credit for which the relief can be exchanged will be 25% for touring exhibitions and 20% for non-touring exhibitions. Relief will be capped at £500,000 of qualifying expenditure per exhibition.

The government will shortly publish a consultation response and draft legislation for inclusion in the Finance Bill 2017, with the measure due to take effect from 1 April 2017. The draft legislation will include a sunset clause, so that the relief will expire in April 2022, unless renewed. In 2020, the government will review the relief and set out its plans beyond 2022.

For more information, see Private client tax legislation tracker 2016-17: Corporation tax: museums and galleries.

(See HM Treasury: Autumn Statement 2016, paragraph 4.30 and HM Treasury: Autumn Statement 2016: policy costings, page 37.)

The government has confirmed that it will introduce legislation to expand the deductibility of corporate contributions to grassroots sports. The measure was first announced in the 2015 Autumn Statement and was subject to a consultation that ran between 24 March and 15 June 2016 (see Legal update, Consultation on deductions for corporate contributions to grassroot sports).

Legislation will be included in the Finance Bill 2017, and a summary of responses to the consultation will, presumably, be published shortly. No mention is made of the further consultation suggested at the time of the original consultation.

To track the progress of the measure to implementation, see Private client tax legislation tracker 2016-17: Corporation tax: contributions to grassroots sport.

(See HM Treasury and HMRC: Autumn Statement 2016: tax updates and technical changes, paragraph 2.2.)

The government has reconfirmed its intention to give intermediaries a greater role in administering Gift Aid, thereby simplifying the Gift Aid process for donors making digital donations.

There is nothing new in this announcement. We are currently waiting for HMRC to publish a response on its technical consultation on draft regulations setting out the detailed operating models for intermediaries who administer Gift Aid on behalf of charities.

For further detail and to track developments, see Private client tax legislation tracker 2016-17: Gift Aid: digital giving. For more information on Gift Aid, see Practice note, Gift Aid for individuals, sole traders and partnerships: overview.

(See HM Treasury: Autumn Statement 2016, paragraph 4.17.)

Following the review announced in the 2015 Autumn Statement, the government is in the process of amending the Gift Aid Small Donations Scheme (GASDS) to make it more accessible and flexible, and to ensure fairer treatment between charities that are structured in different ways.

There is nothing new in this announcement. The Small Charitable Donations and Childcare Payments Bill 2016-17 is currently making its way through Parliament. The Bill includes provisions to amend the Small Charitable Donations Act 2012 to reform GASDS. For further details and to track the Bill's progress, see Private client legislation tracker: Small Charitable Donations and Childcare Payments Bill 2016-17. For more information on GASDS, see Practice note, Gift Aid Small Donations Scheme (GASDS).

The government has estimated that the combined cost to the Exchequer of the changes to GASDS and to Gift Aid (see Gift Aid digital giving) will be an additional £20 million by 2021-22.

(See HM Treasury: Autumn Statement 2016, paragraph 5.18 and HM Treasury: Autumn Statement 2016: policy costings, page 36.)

The government has announced that it will publish its response to the consultations on making tax digital in January 2017. HMRC launched the consultations on 15 August 2016.

The government has reported that if the consultations lead to any change in the policy, they will consider them in their next forecast.

For more information and to track these developments, see, Private client tax legislation tracker 2016-17: Making tax digital.

(See HM Treasury: Autumn Statement 2016, paragraph 4.42 and HM Treasury: Autumn Statement 2016: policy costings, paragraph B.32.)

As announced in the 2016 Budget, the government has confirmed that it will introduce new measures to:

HMRC launched a consultation on proposed penalties for enablers and users of defeated tax avoidance arrangements, together with other options for deterring avoidance, in August 2016. The consultation closed on 12 October 2016.

The proposals set out in the consultation document were controversial and a number of professional bodies have objected to them, arguing that they went too far and might result in advisers being deterred from providing advice. The announcement does not state whether the new measures will be identical to those originally contemplated by the consultation document, but it is likely that the controversy will continue.

The government has stated that it will publish draft legislation shortly, but does not confirm whether it will form part of the Finance Bill 2017 or when the new measures will take effect.

For more information, see Legal update: Consultation on penalties for enablers and users of defeated tax avoidance arrangements.

(See HM Treasury: Autumn Statement 2016, paragraph 4.48.)

In order to tackle the hidden economy the government has announced that it will:

These proposals follow on from three consultations published in August 2016 on tackling the "hidden economy" (which the government has defined as comprising individuals and businesses evading or avoiding paying their fair share of tax).

The announcement states that further details will be provided in the government's 2017 Budget.

For more information, see Legal update, HMRC publishes three consultations on tackling the hidden economy and Practice note, HMRC criminal investigation policy.

(See HM Treasury: Autumn Statement 2016, paragraphs 4.55 and 4.56 and HM Treasury: Autumn Statement 2016: policy costings, page 32.)

The government has announced that it will introduce legislation to enable HMRC and taxpayers to conclude discrete matters in enquiries via partial closure notices. Currently an enquiry can only be finalised once all disputed matters have been resolved, causing time delays and cash flow issues in large and complex cases.

The legislation will take effect from Royal Assent of the Finance Bill 2017 and will be applicable to existing, as well as new cases.

This announcement follows a consultation that ran from 18 December 2014 to 12 March 2015.

Responding to the consultation, HMRC had indicated that it intended to consult on alternative models for the partial closure notices, but there has been no public consultation on this. It is, therefore, unclear to what extent concerns raised during the consultation will be addressed in the legislation. The government has indicated, however, that taxpayers (and not just HMRC) will be able to apply to a tribunal for a partial closure notice, which was the main issue arising out of the consultation.

For more information, see Legal update, Tax enquiries closure rules: HMRC publishes response to consultation and Private client tax legislation tracker 2016-17: Tax enquiries: partial closure.

(See HM Treasury: Autumn Statement 2016, paragraph 4.44 and HM Treasury: Autumn Statement 2016: policy costings, pages 28 and 29.)

The government has announced that it will invest further in HMRC in order to:

The government estimates that this will bring in an additional £450 million over the next five years (although the Office for Budget Responsibility has given this estimate a "High" score of uncertainty).

(See HM Treasury: Autumn Statement 2016, paragraph 4.49 and, HM Treasury: Autumn Statement 2016: policy costings, Table B2.)

As part of the Autumn Statement, the government has published a letter from the Financial Secretary to the Treasury to the Office of Tax Simplification setting out the scope of future reviews and follow-up action to be undertaken. The main areas of interest for private client practitioners include:

(See Correspondence between the Chancellor, Financial Secretary to the Treasury and the Office of Tax Simplification regarding recent OTS publications.)