Autumn Statement 2022

17th November 2022

The Autumn Statement 2022 comes at a time of significant economic challenge not only for the UK but globally.  The government’s priorities are stability, growth, and public services.  Here are the key points from the announcement:-

 

Personal taxes

From 01 April 2023 Additional Rate threshold will reduce from £150,000 to £125,140 causing more income to be taxed at 45% rather than 40%.

Tax free allowances and thresholds to be frozen until April 2028:

• Personal allowance at £12,570,
• Higher rate band at £50,270
• NIC thresholds for employees at £12,570
• IHT Nil Rate Band (£325,000) and Residence Nil Rate Band (£175,000), tapering at the same £2,000,000 estate value.

Dividend allowance reduced from £2,000 to £1,000 from April 2023 and then to £500 from April 2024

Capital Gains Tax Annual Exemption of £12,300 cut to £6,000 from April 2023 and to £3,000 from April 2024

Reduced SDLT thresholds remain until 31 March 2025

Seed Enterprise Investment Scheme – limits increased to £250,000 from £100,000 investment

Capital Gains Tax nil gain/ nil loss transfers for couples separating or divorcing extended to 3 years

 

Increases

State pension & benefits to rise in April 2023 with September CPI of 10.1%

Review of state pension age to be released in early 2023

National Living Wage increase 9.7% to £10.42 an hour for those aged 23 and over

Minimum wage increases:

• Increasing the rate for 21-22 year olds by 10.9% to £10.18 an hour;
• Increasing the rate for 18-20 year olds by 9.7% to £7.49 an hour;
• Increasing the rate for 16-17 year olds by 9.7% to £5.28 an hour;

 

Cars

From April 2025, Electric Vehicles no longer exempt from Vehicle Excise Duty

Electric Vehicle Benefit in Kind rates increase by 1% in 2025/26, 1% in 26/27, and 1% in 27/28 up to maximum 5%. Fixed at current rates until April 2025.

Benefit in Kind rate on other fuels increase by 1% in 2025/26 up to maximum 37% then fixed for 26/27 and27/28

Van benefit, and fuel benefits increase in April 2023 in line with CPI

100% First Year Allowances on electric vehicle charge points extends for two years to April 2025

 

Business taxes

Employers NIC threshold frozen until 2028 at £9,100

Employment allowance frozen at £5,000

VAT registration threshold frozen at £85,000 to March 2026

Annual Investment Allowance set at £1 million extended from 01 April 2023

Corporation Tax rate confirmed at 25% from April 2023 with a 19% small profits rate (under £50,000)

Enveloped Dwellings (ATED) – charge uplifted by September CPI 10.1%

 

HMRC

Additional compliance resource. Investing additional £79m over 5 years for additional staff to tackle tax fraud and compliance risks, particularly among wealthy taxpayers.

 

Business rates

Revaluation of business properties to proceed in April 2023, the first revaluation since 2017

Multipliers frozen in 2023/24 at 49.9p and 51.2p preventing them from increasing to 52.9p and 54.2p.

Transitional relief for three years capping increases brought about from the April 2023 revaluation

Support for eligible retail, hospitality, and leisure businesses extended and increased from 50% to 75% business rates relief up to £110,000 per business in 2023-24

 

R&D

From 01 April 2023 – RDEC rate increases from 13% to 20%

SME additional deduction will decrease from 130% of qualifying expenditure to 86% of qualifying expenditure.

SME credit rate will decrease from 14.5% to 10%

Further reform expected in Spring Finance Bill

 

Investment Zones

Previously announced by Liz Truss, scrapped, and refocused around universities in deprived areas

 

If you have any queries following today’s announcement, please do not hesitate to contact us.