The Spring budget was presented by Mr Philip Hammond on 8th March 2017.

 

A summary of the main points are noted below:

 

  • Class 4 National Insurance to increase from 9% to 10 % in April 2018 and to go up to 11% in April 2019. All class 4 earnings above £43,000 will continue to be taxed at 2% while those below £8,060 will continue to pay nothing.
  • Class 2 National Insurance for workers making a profit of over £5,965 is to be scrapped as planned in April 2018
  • Dividend Allowance to reduce from £5,000 to £2,000 from April 2018
  • Dividend income paid on shares held in a stocks and shares ISA will remain tax free
  • Making tax digital – Privately owned SMEs to get an extra year to prepare for digitalisation and quarterly reporting
  • £100m to be made available to place more GPS in A&E departments for next winter
  • £5m to be made available for ‘return ships’ – helping people back to work after a career break
  • New T levels to be introduced to give parity of esteem for technical education
  • Over all Isa savings limit will increase from £15,240 for 2016/17 to £20,000 for 2017/18

 

In addition to the above, Mr Hammond also addressed the following items which have been previously announced:

 

  • Personal Allowances to be increased to £11,500 this year and to £12,500 by 2020
  • Basic Rate tax band to be increased to £33,500 for 2017/18, meaning the higher rate 40% tax band will now take effect on income over £45,000 (different for those resident in Scotland)
  • Corporation tax rate to be reduced to 19 % for years beginning 1 April 2017, 1 April 2018, and 1 April 2019 and to 17% for the financial year beginning 1 April 2020
  • Corporation tax loss relief –from 1 April 2017 large companies will only be able to use losses carried forward against up to 50% of their profits above £5m. For groups, the £5m will apply to the group
  • Inheritance Tax – The nil rate band remains at £325,000. New deemed domiciled rules apply from 6 April 2017 for inheritance tax, income tax and capital gains tax
 

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