A summary of some of the proposed legal changes relevant to commercial organisations anticipated in 2018:
1. FREEZING OF CHARGEABLE GAINS INDEXATION ALLOWANCE
Companies disposing of assets after this year will be allowed to use an indexation allowance covering only the movement in RPI from the date of acquisition of the asset to 31 December 2017.
Timeframe: Will affect disposals on or after 1 January 2018
2. CONSUMER RIGHTS - PAYMENTS OF SURCHARGES
The Payment Services Regulations 2017 amend the Consumer Rights (Payment Surcharges) Regulations 2012 and bring about changes to the rules on payment surcharges, including a ban on traders imposing any surcharges on retail transactions with consumers where payment is made by debit card, credit card or online.
Timeframe: Effective from 13 January 2018.
3. INSURANCE DISTRIBUTION DIRECTIVE
The Insurance Distribution Directive is designed to build on the current framework regulating insurance sales. It aims to strengthen insurance customer protection, create a level playing field for all those involved in insurance sales and encourage cross-border trading.
Timeframe: Due to come into law by 23 February 2018.
4. MINIMUM ENERGY EFFICIENCY STANDARD
The Minimum Energy Efficiency Standard (MEES) is intended to improve the energy efficiency of rented property in England and Wales. Following implementation, landlords will not be permitted to let commercial properties that have an EPC rating below E unless they have first made all possible cost-effective energy efficiency improvements in accordance published regulations or an exemption applies.
Timeframe: Applies to leases granted on or after 1 April 2018.
5. BUSINESS RATES INDEXATION
The switch from inflation indexation tied to the retail price index to inflation indexation tied to consumer price index has been brought forward to 1 April 2018.
Timeframe: Effective 1 April 2018.
6. PENSIONS: AUTO-ENROLMENT
Minimum employer contributions in respect of jobholders are set to rise from 1% to 2% of 'qualifying earnings' and minimum total employer and jobholder contributions (including tax relief) will increase from 2% to 5%.
Timeframe: The changes to minimum contributions take effect from 5 April 2018.
7. TAXATION OF TERMINATION PAYMENTS
All payments in lieu of notice (whether or not there is a contractual right to make such a payment) will be treated as earnings and therefore subject to deductions for tax and National Insurance contributions.
Timeframe: Anticipated to come into effect in April 2018.
8. GENDER PAY GAP REPORTING
April brings about the deadline by which private sector organisations with at least 250 employees are required to publish their first gender pay gap report (public sector organisations have to publish their reports by 30 March 2018).
Timeframe: Relevant private sector organisations are required to publish their first report by 4 April 2018.
The General Data Protection Regulation (GDPR) applies from 25 May 2018 and brings about important changes to data protection law. The GDPR will apply to the processing of personal data by both data controllers and data processors. The new measures include increased accountability and a requirement on organisations to take a more proactive approach to data protection compliance. Failure to meet the requirements of the GDPR can lead to significant fines and damage to reputation.
Timeframe: Effective 25 May 2018
A new e-privacy regulation will bring about changes to the processing of personal data and the protection of privacy in electronic communications. Implementation of the regulation is intended to dovetail with that of the GDPR, meaning a May 2018 implementation date, although this may slip.
Timeframe: Implementation possible in May 2018.
11. TRADE SECRETS
A new trade secrets directive is set to harmonise existing laws on trade secrets across the EU and establish common minimum standards for the protection of undisclosed know-how and business information (trade secrets). The directive sets out when the acquisition, disclosure and use of a trade secret will be unlawful and procedures to follow in the event of a breach.
Timeframe: The directive should be transposed into national law by 9 June 2018.
12. CORPORATE GOVERNANCE
Following a government consultation on corporate governance reform in 2016/17 and the current consultation being carried out by the Financial Reporting Council, a revised UK Corporate Governance Code is expected to be published in early summer 2018, although it is expected to apply to accounting periods beginning on/after 1 January 2019.
Timeframe: New UK Corporate Governance Code expected June 2018.
If you would like further information about any of the anticipated changes, please don't hesitate to get in touch or contact us online.
This document is for informational purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any of the information given.