On Thursday the Chancellor of the Exchequer, the Rt Hon Jeremy Hunt MP, made his long awaited Autumn Statement speech. The Chancellor set out the government’s plan with the aim of putting public spending on a sustainable footing and to reduce Government debt falling.

The Chancellor positioned today’s Autumn Statement as a plan for stability, growth and public services but its main aim was to tackle a significant hole in the public finances without jeopardising economic recovery. 

He cited tackling inflation as the top priority and unveiled a £26b support package to help tackle the cost-of-living crisis.  He also announced a £13.6 billion package of support for business rates payers in England to protect businesses from rising inflation.

There is no doubt that the tax burden on business will increase due to this statement. If you need to ask any questions, or are unclear how this will affect you or your business, please contact us at the office, our partners and staff will be only too pleased to help.

Please find below the headline measures:

Personal Tax

Threshold at which higher earners start to pay the 45p rate to be reduced from £150,000 to £125,140

Income Tax, Inheritance Tax and National Insurance thresholds to be frozen for a further two years until April 2028

Dividend Allowance will be reduced from £2,000 to £1,000 next year, and £500 from April 2024

Annual Exempt Amount in capital gains tax will be reduced from £12,300 to £6,000 next year and then to £3,000 from April 2024

Income Tax and National Insurance contributions thresholds will be fixed at their current rates until April 2028

Business Tax

National Living Wage to be increased by 9.7% to £10.42 an Hour

Business Rates – £1.6 billion Transitional Relief scheme to help businesses adjust to the revaluation of their properties

Main rate of Corporation Tax will increase to 25% from April 2023

Reforms to R&D tax reliefs – The Chancellor outlined plans to reduce the R&D tax credit for SMEs from 130% to 86% of qualifying costs. SMEs surrendering losses for a repayable credit will receive only 10% of those losses – currently it is 14.5%

Annual Investment Allowances (AIAs) will be permanently set at £1 million, the Autumn Statement has advised that the super-deduction rules are no longer required and will cease for expenditure beyond 1 April 2023, as originally stated

General Economy

The Energy Price Guarantee scheme will continue to provide support from April 2023 for a further 12 months with the cap rising to £3,000

Pension triple lock to remain

Funding for the NHS and social care will be increased by up to £8 billion in 2024-25

£2.3 billion of additional funding for schools in both 2023-24 and 2024-25

From 1 January 2023 the Energy Profits Levy on oil and gas companies will increase from 25% to 35%, with the levy remaining in place until the end of March 2028

A new, temporary 45% levy will be introduced for electricity generators

The Chancellor also confirmed commitments to High Speed 2 to Manchester, the Northern Powerhouse Rail core network and East West Rail

£1.7 billion to be allocated to priority local infrastructure projects around the UK before the end of the year as part of the levelling up agenda

If you would like further clarification on any of the changes, please don’t hesitate to contact us on 01827 54944 or [email protected]