The government will increase the funds available to invest through the Business Finance Partnership (BFP) to £1.2 billion (from £1 billion). For information on the BFP, see Legal update, Credit-easing measures for SMEs: detail released: Business Finance Partnership.

(See HM Treasury: 2012 Budget report, paragraphs 1.66 and 2.233, pages 28 and 79 and Business Finance Partnership.)

On 19 March 2012, the government launched the National Loan Guarantee Scheme (NLGS). Under the NLGS, the government will provide up to £20 billion of guarantees to banks on their unsecured debt in return for a fee, making it cheaper for participating banks to borrow. For more information on the NLGS, see Legal update, National Loan Guarantee Scheme launched.

(See 2012 Budget report, paragraph 1.65, page 27.)

The government has reiterated its previous announcement that it will raise the level of lenders' Enterprise Finance Guarantee portfolios (to which a government guarantee applies) from 13% to 20% for the 2012-13 financial year. This is intended to incentivise lenders to lend more to smaller businesses under the EFG scheme.

For more information on the EFG scheme, see Legal update, Enterprise Finance Guarantee scheme extended.

(See 2012 Budget report, paragraphs 1.233 and 2.235, pages 44 and 79.)

The government stated that, over the course of this year, it will take forward the recommendations following the review of non-bank lending chaired by Tim Breedon (Breedon Report) including:

For more on the Breedon Report, see Legal update, Non-bank lending: Breedon report and government response.

In addition, the government took the opportunity to welcome commitments by banks to:

(See 2012 Budget report, paragraph 2.236, page 79.)

The government has announced that it will consult on the introduction of a general anti-abuse rule (GAAR) in summer 2012, with a view to introducing legislation in the Finance Bill 2013. The government has also announced that it will extend the GAAR to stamp duty land tax (SDLT).

For more information, see Legal update, 2012 Budget: key business tax announcements: General anti-abuse rule.

(See 2012 Budget report, paragraphs 1.194 and 198, pages 34 and 76.)

As part of a package of measures aimed at tackling tax avoidance in connection with UK residential property, the government will extend the scope of capital gains tax to cover gains arising on disposals by non-resident, non-natural persons of UK residential property and shares or interests in UK residential property.

Legislation will be included in Finance Bill 2013, to take effect from April 2013. The government will consult on the detail of the measure alongside its consultation on the SDLT new penal rate for enveloping high value residential properties (broadly, owning and disposing of property via non-natural persons).

The term "non-natural persons" is not defined for this measure, but the Tax Information and Impact Note on the new SDLT rate for enveloping of high value residential properties indicates that, for the purposes of that measure, the term will include companies, collective investment schemes (including unit trusts), and partnerships in which a non-natural person is a partner (see SDLT: enveloping high value residential property).

For more information, see Legal update, 2012 Budget: property implications: CGT regime to extend to disposal of residential property owned by non-natural persons.

(See 2012 Budget report, paragraphs 1.195 and 2.75, pages 34 and 63.)

The government has announced that it will introduce, with immediate effect, an SDLT rate of 15% for UK residential property acquisitions by "non-natural persons" (whether or not acquired together with others) if the consideration is over £2 million. This new rate will apply to transactions with an effective date after 20 March 2012, but transitional rules will disapply the new rate if the sale contract was completed and signed by all parties to the transaction before 21 March 2012. These measures will be included in the Finance Bill 2012.

A "non-natural person" includes companies, collective investment schemes (including unit trusts) and partnerships in which a non-natural person is a partner. Property developers and corporate trustees "in certain circumstances" will be excluded from the new rate.

High net worth individuals commonly use offshore companies in structures for holding UK property for capital tax, and non-tax, purposes. These sorts of arrangements will need to be reviewed once the detailed rules become available.

For more information, see Legal update, 2012 Budget: property implications: New SDLT rate for high-value residential purchases by non-natural persons.

(See 2012 Budget report, paragraphs 1.195 and 2.174, pages 34 and 73.)

The government has issued draft anti-avoidance legislation, for inclusion in Finance Bill 2012, that outlaws a specific SDLT scheme that relies on the application of the SDLT transfer of rights (sub-sale) rules. This legislation is designed to counter a specific avoidance scheme involving the granting of purchase options at completion, so that SDLT is not payable on a property purchase and does not become payable on the option unless exercised (which is not intended).

The draft legislation makes it clear that an "assignment, sub-sale or other transaction" does not include the grant or assignment of an option and, therefore, the transfer of rights provisions will not apply to the scheme transactions. The legislation will apply to options granted or assigned on or after 21 March 2012.

For more information, see Legal update, 2012 Budget: property implications: Clarifying whether sub-sale rules apply to the grant of an option.

(See 2012 Budget report, paragraph 2.200, page 76.)

The government has confirmed that draft legislation amending the disclosure of tax avoidance schemes rules that are applicable to stamp duty land tax will be included in the Finance Bill 2012.

The legislation, which permits the removal of the grandfathering rules for certain avoidance schemes using the sub-sale rules, and removes the thresholds for making a disclosure, was first published on 6 December 2011 (see Legal update, Draft Finance Bill 2012 legislation: finance implications: Avoidance schemes). It will be included in the Finance Bill 2012 with no amendments or with only "small, technical" amendments.

For background information, see Practice note, Real estate finance (investment): overview: Stamp duty land tax.

(See 2012 Budget report, paragraph 2.199, page 76.)

The government has confirmed that the Finance Bill 2012 will contain provisions amending the loan relationship connected company impaired debt rules to ensure that they are not circumvented. These provisions were published in draft form on 27 February 2012 (see PLC Tax, Legal update, Retrospective debt buy-back avoidance measures announced).

For more information on debt buy-backs, see Practice note, Debt buy-backs.

NOTE ADDED 5 APRIL 2012: For a detailed update on the draft legislation published in the Finance Bill 2012 for the amended debt buy-back provisions, see Legal update, Finance Bill 2012: Amended debt buy-back provisions.

(See 2012 Budget report, paragraph 2.201, page 76.)

The Finance Bill 2012 is to include legislation amending the calculation of the disposal value that is brought into account for capital allowance purposes on (deemed) termination of a long funding lease. For the current rules, see Practice note, Equipment leasing: tax: How capital allowances are given. This measure is a reaction to disclosures of tax avoidance schemes and has not previously been announced.

For more information, see Legal update, 2012 Budget: key business tax announcements: Long funding leasing: capital allowances disposal value.

(See 2012 Budget report, paragraph 2.212, page 77.)

The government has confirmed that the draft legislation seeking to close down a scheme under which taxpayers sought offset or repayment of income tax of amounts treated as withheld under the manufactured overseas dividend rules, published on 6 December 2011 (see Legal update, Draft Finance Bill 2012 legislation: finance implications: Avoidance schemes: Manufactured overseas dividends), is to be included in the Finance Bill 2012 with no amendments or with only "small, technical" amendments.

The government has also confirmed that it will consult on proposals to simplify the manufactured payments tax rules as part of its rolling review of high risk areas of the tax code. (For background information, see Practice note, Repos: tax: Manufactured interest and Manufactured dividend.) This consultation was announced on 15 September 2011 (see Legal update, Manufactured overseas dividend avoidance scheme closed) and is to be launched shortly.

For more information, see Legal update, 2012 Budget: key business tax announcements: Manufactured overseas dividends and Manufactured payments.

(See 2012 Budget report, paragraphs 2.204 and 2.206, pages 76 and 77.)

The government proposes to make up to £150 million available from 2013 to 2014 for large-scale projects in core cities to be financed through tax increment financing (TIF). TIF enables local authorities to borrow against future growth in business rates. Details on a competition to allocate funding will be announced in the coming months.

(See 2012 Budget report, paragraph 2.27, page 58.)

In 2012-13, the government will introduce a 20 basis points discount on loans from the Public Works Loans Board under the prudential borrowing regime for those principal local authorities providing improved information and transparency on their locally determined long-term borrowing and associated capital spending plans.

(See 2012 Budget report, paragraph 2.24, page 58.)