Autumn Statement 2023
Posted on 23rd November 2023 at 14:58
The Chancellor, Jeremy Hunt, has delivered another Autumn Statement, with the General Election looming and the cost of living crises still impacting upon many people’s lives.
With changes to National Insurance rates, state pensions and capital allowances there were 110 updates to roll out. We have summarised some of the main outcomes which have come about as a result of this Statement.
Income Tax Allowance + National Insurance + Rate Bands
As was previously announced in the 2022 Autumn Statement, the Personal Tax Allowance currently set at £12,570, will remain at this level until 2028. The Basic Rate Tax Band, presently set at £37,700 will also stay the same until April 2028. Personal allowances will be reduced by £1 for every £2 a person’s income exceeds £100,000.
From 6 April 2024, self-employed people with profits above £12,570 will no longer be required to pay Class 2 NICs, but will continue to receive access to contributory benefits, including the State Pension.
The self-employed Class 4 NI rate will be reduced from 9% to 8% from 6th April 2024.
The employee Class 1 NI rate will be reduced from the present 12% to 10% with effect from 6th January 2024.
National Minimum Wage (NMW) and National living Wage (NLW)
A reminder that the NMW and NLW are due to increase from the beginning of April 2024. Workers aged 21 years + will now be paid £11.44 per hour from April 2024.
Dividends
As already announced , the zero rate of tax dividend threshold will fall from £1,000 to £500 from 6th April 2024. There will be no change to the dividend tax rate.
State pension
Under the triple lock, SP rises in line with the highest of average earnings, inflation or 2.5% based upon September 2023 figures.
The highest figure was the average earnings rate for September 2023 of 8.5%. The Government have decided that the SP will increase by 8.5% from April 2024.
Construction Industry Scheme (CIS)
From 6th April 2024, subcontractors will have to demonstrate compliance with VAT obligations to be granted and keep gross payment status. HMRC will be able to immediately cancel gross payment status to include cases where they have reasonable grounds to suspect fraud involving VAT, Corporation Tax, Income Tax and Pay As You Earn.
Business Rates (England)
There is a business rates support package worth £4.3 billion over the next 5 years for small businesses and the high street. The small business multiplier will be frozen for a fourth consecutive year. Retail, hospitality and leisure 75% business rates relief will be extended.
Capital Allowances
As announced in the 2023 Spring Budget, for qualifying expenditure incurred on or after 1st April 2023, companies can claim a 100% first year allowance for main rate expenditure (known as full expensing) and 50% first year allowance for special rate expenditure.
Full expensing was due to end on 31st March 2026. This sunset clause has now been removed.
How to get further help
If you are unsure as to whether you are affected by any of the changes that the Autumn Statement has brought in, or would like further information please do let our team know. We will be happy to share further information with you as requested. You can call us on 01937 584188 or send us a call back request.
Tagged as: Autumn Statement
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