Today, Thursday 17 November 2022, Chancellor Jeremy Hunt delivered his Autumn Statement.
Many were hoping his announcements would help individuals and businesses in the face of increasing costs, with inflation at a 40 year high coming in at 11.1%. Instead Hunt delivered a bleak outlook for the next few years blamed on the fallout from Global factors, including COVID.
Hunt’s 3 main points of the budget were, Stability, Growth and Public Services.
Individuals and Businesses
Personal Tax Allowance – Hunt announced that the personal tax thresholds will remain as they are until 2028, meaning the more people earn, the more tax they will pay.
National Insurance and Inheritance Tax – Thresholds for National Insurance and Inheritance Tax have also been frozen until April 2028.
Income Tax – The 45% Additional Higher Rate Tax threshold, will be reduced from £150,000 to £125,140.
National Living Wage – To increase from £9.50 per hour to £10.42 per hour for over 23’s from April 2023. Those who earn the NLW are expected to receive an extra £1,600 per year.
Stamp Duty Land Tax (SDLT) – Rules will remain as previously set out until 2025, in hope that the property market will remain steady.
Capital Gains Tax – Annual exempt amount for capital gains tax to be cut from £12,300 to £6,000 from April 2023 and then to £3,000 from April 2024.
Businesses
Employment Allowance – To remain at £5,000 per year until 2026, which benefits small employer’s by covering or reducing the employer’s National Insurance liability.
Business Rates – A revaluation on business rates will continue in April 2023, which will ”soften a blow” for businesses on business rates which is expected to benefit roughly 700,000 businesses.
Dividends – Tax free allowances for dividends are to be cut from £2,000 in April 2023 to £1,000 and then again in April 2024 to £500.
Energy Relief – Support to remain from April 2023 for another year. Guarantee to be increased from £2,500 to £3,000 meaning households will pay more for their energy. Support from the Government is still to be provided but less generous at around £500 for households.
R&D Tax Relief – R&D tax relief for SMEs (small and medium sized enterprises) deduction rate cut to 86% and the credit rate to 10% with an increase to the rate of the separate R&D expenditure credit from 13% to 20%.
Autumn Statement Other Announcements
Electric Vehicles – Electric vehicles will no longer be exempt from vehicle excise duty from April 2025.
Infrastructure – Plans to keep growing and improving the UK’s infrastructure include the Northern Powerhouse Rail, new hospitals and gigabit broadband.
Jeremy concluded his statement by praising the UK to be ”Tough, Inventive and Resourceful”.
How we can help
If you have any questions on how the announcements impact on you or your business, please contact us at mail@seavorchartered.co.uk or 01228 904904.
