On 23 November 2016, the Chancellor of the Exchequer, Philip Hammond, delivered the Autumn Statement.

This update summarises matters of interest to agriculture and rural land practitioners, landowners and those operating businesses in rural areas. For an analysis of other aspects of the 2016 Autumn Statement, see box, Further reading.

The annual tax on enveloped dwellings (ATED) was introduced by the Finance Act 2013. It forms part of a package of measures designed to dissuade individuals from acquiring and holding high-value residential property in the UK through, principally, companies. For more information, see Practice note, Annual tax on enveloped dwellings (ATED).

The government has announced that the annual charges for ATED will rise in line with inflation for the 2017 to 2018 chargeable period.

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

The government will invest £740 million in digital communications between 2017-18 and 2021-22 through the government's new National Productivity Investment Fund (NPIF). The investment in digital communications will be targeted at rolling out full-fibre connections and future 5G communications. Improving fibre connections is intended to bring faster and more reliable broadband to homes and businesses across the UK.

(2016 Autumn Statement, paragraph 3.20.)

For more information, see 2016 Autumn Statement: key telecoms announcements.

The government has announced that £170 million will be invested in flood defence and resilience measures. This sum comprises:

(2016 Autumn Statement, paragraph 3.25.)

It is not clear to what extent this expenditure forms part of the spending on flood defences and resilience announced in the 2016 Budget (see 2016 Budget: key property announcements: Flood defences).

The government confirmed that, as announced in the 2016 Budget, it will introduce two new allowances that will exempt from tax the first £1000 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. For background, see 2016 Budget: key business tax announcements: Trading and property income allowances.

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 Tax legislation tracker: owner-managed business: Trading and property income allowances.

(2016 Autumn Statement, paragraph 4.14.)

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 has 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 Tax legislation tracker: miscellaneous: Review of partnership taxation.

(2016 Autumn Statement: tax updates and technical changes, paragraph 2.7.)

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 this.

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 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.

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