As widely expected and in distinct contrast to the ill fated mini budget, today the current chancellor Jeremy Hunt announced wide ranging increases to UK tax.
The main announcements affecting individuals and small businesses are summarised below, most of which will take effect from 6 April 2023 (2023/2024) :
Lowering the threshold of the 45% rate from £150,000 to £125,000
Freezing personal allowance thresholds until April 2028
The "tax free" Dividend tax allowance will be cut to £1,000 (Then £500 for 2024/2025)
Capital gains tax (CGT) annual exemption cut from £12,300 to £6,000 (Then £3,000 2024/2025). It is not yet clear if the CGT reporting threshold normally 4 times the CGT Annual exemption will be lowered.
Inheritance tax nil rate bands frozen until 2027/2028
Employer’s NI threshold Frozen until April 2028
Employers NIC annual Allowance will be retained at £5,000
VAT threshold maintained until March 2026
R&D relief for SMEs cut to 86% and the credit rate to 10%
Stamp Duty Land Tax cut will remain only until March 2025
Increasing the national living wage for over 23 year olds to £10.42
There were also significant announcements including a gas and Oil windfall tax, inflation linked state pension increases and confirmation of the fact the UK economy is now officially in recession being a clear sign of tougher times ahead.
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