Autumn Statement 2022

Just 55 days after Kwasi Kwarteng delivered the infamous mini budget, today the Chancellor, Jeremy Hunt, delivered his Autumn Statement. His priorities for the budget were to provide stability, growth and public services.

Below are some of the announcements, more details will follow in the next few days:

Economy

  • As the economy has shrink for two consecutive quarters, the UK is officially in a recession.
  • Office Budget for Budget Responsibility (OBR) predicts overall growth of 4.3% for 2022, the economy will shrink by 1.4% in 2023 and growth of 1.3%, 2.6% and 2.7% in 2024,2025 and 2026.
  • Estimated that inflation for 2022 will be 9.1% and 7.4% in 2023.
  • Unemployment levels expected to rise to 4.9% in 2024 from today’s 3.6% level.

Business Tax

  • Employment Allowance will remain at £5,000 per annum until March 2026.
  • R&D tax relief for SME’s deduction rate cut to 86% and the credit rate to 10% but increase the rate of the separate R&D expenditure credit from 13% to 20%.
  • VAT registration threshold will remain at £85,000 until March 2026.
  • Almost two thirds of business properties will not pay any more in business rates next year.
  • Benefit in Kind for electric company cars will increase.

Personal Tax

  • The Additional rate threshold, at which 45% income tax is paid, will reduce from £150,000 to £125,140 from April 2023.
  • Other Income Tax personal allowances and thresholds will remain at the current level until April 2028.
  • Main National Insurance and Inheritance tax thresholds are also frozen until April 2028.
  • Dividend allowance will be cut from £2,000 down to £1,000 from April 2023 and reduced further to £500 from April 2024.
  • The Annual Exemption for Capital Gains Tax will be cut from the current level of £12,300 down to £6,000 from April 2023 and then £3,000 from April 2024.

Other Points

  • The Chancellor confirmed that pension credit will rise by 10.1% from April 2023, delivering his promise on the triple-lock.
  • From April 2023, the National Living Wage will increase to an hourly rate of £10.42, a rise of 9.7%.
  • Stamp duty cuts announced in September will remain in place until March 2025.
  • From April 2025 electric vehicles will no longer be exempt from vehicle excise duty.

 

If you have any questions on the announcements, please contact us to discuss.

 

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