BUDGET SUMMARY – Autumn 2017

I have tried to summarise those aspects of the Budget which should interest readers the most in respect of potential tax savings and benefits.  A full version can be found at https://www.gov.uk/government/topical-events/autumn-budget-2017

BUSINESS TAX

Corporation Tax – Changes confirmed

Financial Year from

1 April 2017

1 April 2018

1 April 2019

Corporation Tax Rate

19%

19%

19%

Business Rates

Business rates will switch from being increased by RPI to CPI from April 2018, two years earlier than originally planned.  Business rates revaluations will take place every three years, rather than every five years, starting after the next revaluation, currently due in 2022.

NATIONAL INSURANCE CONTRIBUTIONS

In a change to the date originally announced, Class 2 NICs are set to be abolished from April 2019.

As previously announced, the government will no longer proceed with an increase to the main rate of Class 4 NICs from 9% to 10% in April 2018 and to 11% in April 2019.

NATIONAL MINIMUM WAGE AND NATIONAL LIVING WAGE

The government has aligned the NMW and NLW cycles so that any increase in rates now occur in April each year.  The rates applying from 1 April 2018 are outlined below.

 

Apprentices

16 and 17

18-20

21-24

25+

National Minimum Wage

£3.70

£4.20

£5.90

£7.38

 

National Living Wage

£7.83

PERSONAL ALLOWANCES

 

2018/19

2017/18

Personal Allowance

£11,850

£11,500`

Married Couples’ Allowance (10% relief)

Either partner born before 6 April 1935

*£8,695

*£8,445

Marriage Allowance

(20% relief)

£1,185

£1,150

The Dividend Allowance reduces from £5,000 to £2,000 from 6 April 2018.

MAKING TAX DIGITAL

The government is phasing in its landmark Making Tax Digital (MTD) initiative, which will see the introduction of a fully digital tax system, with businesses and individuals being required to register, file, pay and update their information via a secure online account.

The revised timetable begins on 1 April 2019 for businesses with a turnover above the VAT threshold (currently £85,000).  Further details should be available from April 2018.

VALUE ADDED TAX

The VAT registration and deregistration thresholds will not be uprated for a period of two years.  The two-year period ends on 31 March 2020.

End