Jeremy Hunt presented his Autumn Statement on 17th Nov 2022, and if there was any doubt UK are in severe recession.
The main changes are:
• CORPORATION TAX: to rise to 25% for all companies with taxable profits in excess of £50,000 from 1st April 2023. This is single biggest increase in last 40 years, and whilst it is temporary, a lot of foreign investors will start to move away from UK. Though it has not been announced it is expected that Property and Investment companies will have a single corporation tax rate of 25% in the Finance Act;
• INCOME TAX: The main changes were to Additional Rate of Tax. The government has really hit the entreprenuals hard by reducing the threshold from £150,000 to £125,140, at a time when UK needed them to revive the ‘failing’ UK economy. With other Income tax thresholds frozen, meaning there will be no increases to personal allowances and higher rate threshold until April 2028;
• NATIONAL INSURANCE: First these were inceased then decreased, but will stay at current rate of 12% for next financial year. However the threshold from which Employer’s NIC starts has been reduced to £9,100 per annum, with the rate remaining at 13.75%;
• CAPITAL GAINS TAX: The rates remain the same, but tax free allowance has been reduced from £12,300 to £6,000, this will be reduced further to £3,000 in 2024;
• DIVIDEND ALLOWANCE: The £2,000 tax free dividend allowance has been reduced to £1,000 with further reduction to £500 from 2024;
• VAT: No changes to VAT;
• INHERITANCE TAX: The tax free amount of £325,000 remains frozen.
The full Autum 2022 Statement can be found at https://www.gov.uk/government/publications/autumn-statement-2022-documents/autumn-statement-2022-html