The Chancellor’s Spring Budget touched on areas including real estate, pensions, corporate tax, and employment but what exactly do these changes mean and how will they impact you?

In this article, our tax law expert Michael Fluss outlines some of the key takeaways of the Spring Budget.

 Real estate

  • Real estate investment trusts (REIT) – main change (with effect from 1 April 2023) is removal of the need for REIT to hold three properties if it has single commercial property worth at least £20m.  Also, refinements in relation to payment of distributions by REIT to partnerships and circumstances in which disposal by REIT of property substantially developed in previous three years may be taxable.
  • SDLT – no substantive changes, which may be a little surprising given the HMRC consultation in 2021/22 looking at a potential tightening of residential/mixed property classification and multiple dwellings relief.
  • Capital allowances – 100% or 50% upfront tax relief for capital spend on plant and machinery (depending on the type of asset) in three years beginning 1 April 2023 (and upfront relief – on a permanent basis – for the first £1m of spend on other plant and machinery in any event).This is likely to have significant tax saving in timing terms and so may enhance relevance or importance of capital allowances in relation to plant and machinery fixtures on commercial real estate sales.
  • Capital gains – completion of unconditional contracts – relevant notification periods and assessment and claim time limits to be determined by reference to when the asset is transferred rather than when the contract was entered into. In cases where the asset transferred more than (for individuals) six months after the end of the tax year or (for companies) 12 months after the end of the accounting period in which the contract entered into. This is aimed at resolving unsatisfactory position (noted in case law) that the time of disposal is when the contract was entered into but no disposal is treated as taking place if, in the event, asset is not disposed of (giving rise, as a result of time limits, to potential difficulties for taxpayers where tax is paid but asset is not ultimately disposed of).  This may be relevant where there is a particularly long completion owing to allowing time for planning consent considerations, but the contract is nonetheless unconditional.


  •  Rate of corporation tax: As previously announced, with effect from 1 April 2023, the rate of UK corporation tax is to increase to 25 per cent in respect of taxable profits (subject to a small profits rate of 19 per cent for companies with profits of up to £50k, with marginal relief for companies with profits between £50k and £250k).
  • Research and development (R&D)  – – the scope of R&D tax credits is to be extended to cover costs of datasets and of cloud computing (the aim being to incentivise R&D) and significant compliance changes in relation to the making of R&D claims.
  • Implementation of Organisation for Economic Co-operation and Development (OECD) driven top-up taxes (to ensure min. 15% tax) – Introduction of (a) multinational top-up tax on UK parent of the group with interests in non-UK companies taxed locally at less than 15%, and (b) domestic top-up tax on UK companies in the group where UK profits would otherwise be taxed at less than 15%.  Broadly, only applicable to groups with annual revenues exceeding €750m.  This is expected to bring in close to £9bn over next five years.
  • Transfer pricing – Changes to documentation required to be kept by multi-national groups with gross revenues in excess of €750m to be implemented to meet OECD Transfer Pricing Guidelines.
  • Seed Enterprise Investment Scheme (SEIS) – the amount capable of being invested in a SEIS company (on which investors can claim relief) is to be increased to £350k (from £250k) in the first three years of trading (previously two years), with the company able to have gross assets of £350k (previously £200k) and investors being able to invest up to £200k p.a. (previously £100k p.a.). This takes effect from 5 April 2023.
  • Qualifying Asset Holding Companies (QAHC) regime – changes are being made to QAHC (funds/investment vehicle tax) regime introduced in 2022 to enhance its effectiveness (so that investors are taxed as if they owned underlying asset and the investment vehicle is taxed only in line with the activities performed by it).


  • Pensions – lifetime allowance will be removed and the annual allowance is to be increased from £40k to £60k (with tapered annual allowance increased from £4k to £10k for individuals with income over £260k and 25% tax free pension commencement lump sum generally limited to £268,275 (being 25% of current lifetime allowance)).
  • Capital Gains Tax (CGT) on exchange of shares/securities – non-domiciled individuals will be liable to CGT on value built up in UK company shares, even when these are exchanged for shares in an offshore holding company (assuming both UK and non-UK companies are or would be close companies). The offshore holding company will, in these circumstances, be treated as a UK company for the purposes of the remittance basis of taxation.
  • Enterprise Management Incentive (EMI) options – admin simplifications: (a) option agreement not required to set out details of restrictions of shares to be acquired by the employee under option, (b) while working time requirement remains, no need for the company to declare that the employee has signed a working time direction when the option is issued, and (c)  from 6 April 2024, the government is to extend the deadline for notifying EMI option from 92 days following the grant to the 6 July following the end of the tax year.
  • Trusts and Estates – statutory formalisation and extension of concession that small amounts of income (up to £500) arising to trusts and estates and beneficiaries of UK estates are not taxable and the removal of default basic rate and dividend ordinary rate of tax that applies to the first £1k slice of discretionary trust income.

If you have questions about how the Spring Budget tax changes will impact you, please contact Michael Fluss.

For further information please contact:

This article is for general information purposes only and does not constitute legal or professional advice. It should not be used as a substitute for legal advice relating to your particular circumstances. Please note that the law may have changed since the date of this article.