On 17 November, the Chancellor, Jeremy Hunt issued the Autumn Statement. It follows several dramatic changes in Government and fiscal announcements over the past couple of months, but it is hoped to be the last for a while.
The key personal tax announcements included:
- Income tax bands (basic rate and higher rate) to be frozen until at least 2028, as well as National Insurance rates.
- Inheritance tax rates to be frozen at £325,000 until 2028.
- Threshold for additional rate tax to decrease in April 2023 from £150,000 to £125,140.
- Capital Gains Tax (CGT) allowance to be reduced over the next two years. CGT will reduce to £6000 in 2023, and this will be halved again in 2024 to £3000.
- Dividend allowances to also be reduced over the next two years. This will halve from the current rate of £2000, to £1000 in 2023, and then to £500 in 2024.
- Cap on the Energy Price Guarantee to increase to an average household cap of £3000 in April 2023 (up from £2500)
- Vehicle excise duty (road tax) to be introduced for electric vehicles from 2025.
- Stamp Duty (SDLT) to remain at £250,000 until 2025.
Many of the changes to affect businesses, had already been announced by the Chancellor in the October Fiscal Statement. However, some which were not previously mentioned, included:
- R&D Relief – changes to the rates of both research & development (R&D) relief schemes. The additional deduction for SME R&D relief will decrease from 130% to 86%, and the SME credit rate will decrease from 14.5% to 10%. The research and development expenditure credit (RDEC) rate will increase from 13% to 20%.
- VAT thresholds to be fixed – VAT registration will remain at £85,000, and VAT deregistration at £83,000 until 2026. (Previously these rates had been fixed until 2024)
Full details of the Chancellor’s statement can be found for on the GOV.UK website.
The above information is based upon our interpretation of the Chancellor’s 2022 Autumn Statement, and we have taken care to provide this information as accurately as possible. However, it should be noted that specific details may change when the final legislation is published, and we cannot entirely guarantee its accuracy.