With most of the Mini Budget measures reversed the Chancellor of the Exchequer, Jeremy Hunt, presented his Autumn Statement on 17 November 2022. The below is a summary of the main measures changed or introduced and is not intended to be a comprehensive summary. If you have any questions regarding items not addressed please contact us to discuss further.

Personal Taxation

Ø  Personal Tax Allowance 2023/2024 £12,570. The personal tax allowance will be frozen at £12,570 until April 2028 ;

Ø  National Insurance thresholds are frozen until April 2028;

Ø  Additional Tax remains at 45% for income but the Threshold at which Additional tax is applied will decrease from £150,000 to £125,140 from 06 April 2023;

Ø  National Living Wage to increase from April 2023 to:

Ø  Dividend Tax threshold for 0% dividend tax will reduce to £1,000 from 06 April 2023 and then to £500 from 06 April 2024. The rates remain the same being 8.75% for basic rate tax payers, 33.75% for higher rate tax payers and 39.35% for additional tax payers.

Capital Gains Tax

The Capital Gains Tax exempt amount will be reduced from the current 2022/2023 level as follows:

VAT

VAT registration threshold of £85,000 turnover will remain unchanged until 01 April 2026.

National Insurance

Ø  Most of the Employees and Employers NIC thresholds and rates will remain at the levels announced for 06 November 2022 until April 2028. The exceptions are:

v 2022/2023 Class 2 small profits threshold of £6,725 will remain for 2023/2024

v Class 2 rate will increase to £3.45 per week from April 2023;

v Class 3 rate will increase to £17.45 per week in 2023/2024.

Ø  Employment Allowance will remain at £5,000 until April 2028;

Electric Vehicles

From 01 April 2025 electric vehicles will no longer be exempt from vehicle excise duty (VED).

VED will be introduced for:

v Electric cars

v Electric vans

v Electric motorcycles

In the first year zero emission vehicles registered on or after 01 April 2025 will pay the lowest level of VED (currently £10 per annum). The VED will then increase to the standard rate from the second year of registration (currently £165 per annum).

Vehicles with a list price of £40,000 currently pay an expensive car supplement VED. The supplement will be extended to electric cars registered on or after 01 April 2025.

The current 100% capital allowance for the provision of electric vehicle charging points has been extended to April 2025.

Stamp Duty Land Tax (SDLT)

SDLT only applied to England and Northern Ireland. Scotland and Wales have there own versions of the tax and may change the rates and thresholds at any time.

The SDLT changes announced in the mini Budget will be reversed from March 2025.

Corporation Tax

The corporation tax increase to 25% for companies with a taxable profit of over £150,000 and the marginal relief for companies with a taxable profit between £50,000 and £150,000 will take effect from 01 April 2023.

Small companies with taxable profits of £50,000 or less will continue to pay corporation tax at 19%.

Welfare and Pensions

Ø  The State Pension will rise by 10.1% from April 2023 as the “triple lock” guarantee has been confirmed for the 2023/2024 year;

Ø  The exact details of more one-off cost of living payments are to be confirmed. Currently it appears that the following will apply:

v £900 for those on means tested benefits to be paid in more than one payment;

v £300 for pensioners;

v £150 for those on disability benefits.

Tax Compliance

The Government is investing an additional £79 million over the next 5 years. The intention is to increase HMRC’s capacity to reduce non compliance amongst wealthy tax payers and to address serious tax fraud.

The above is meant as an indication of the main points included in the Autumn Statement 2022. The information should not be relied upon as taxation advice.

Please contact us at Foremans LLP on 01244 625 500 for a free no obligation discussion on any of the changes above.