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Autumn Budget 2021

Key Points from todays Autumn Budget

 

– The national living wage will increase to £9.50 an hour next year, up from the current £8.91. An increase of 6.6%.

– The Universal Credit taper rate will be cut by 8% from no later than December 1, bringing it down from 63% to 55% – this will allow claimants to retain more of their payment.

– A planned rise in fuel duty will be cancelled as a result of the current 8 year high pump prices.

– Flights between airports in England, Scotland, Wales and Northern Ireland to benefit from a new lower rate of Air Passenger Duty from April 2023.

– 4% levy to be placed on property developers with profits over £25 million.

-A 1.25% increase in the rate of National Insurance for workers and pensioners from April 2022.

-A 1.25% increase on tax on dividend earnings over £2000 per year.

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Autumn Budget 22 November 2017 – Key Points

Hammonds ‘Balanced approach’ – the key points:

 

Business

  • £500m to go towards a 5G mobile network, fibre broadband and AI
  • 1% increase in Benefit in Kind on diesel company cars
  • Vehicle Excise Duty to go up by 1 band from 2018 on cars that don’t meet the standard

 

Northern Ireland

  • Extra £650m to be available to NI executive

 

Living Wage

  • From April 2018 Living Wage to increase from £7.50 to £7.83

(4.4% increase)

 

Excise duty on cigarettes & Alcohol

  • Minimum duty on cigarettes will increase by 2% above retail price index
  • Duty on most ciders, wines, beers and spirits will be frozen
  • High strength white ciders to be increased

 

Fuel duty

  • Fuel duty rise scheduled for April 2018 has been cancelled – Fuel duty will now be frozen

 

Taxation

  • Personal tax free allowance to increase to £11,850 from April 2018
  • Basic rate tax band to be extended – 40% tax threshold rises to £46,350 from April 2018
  • 1% increase on Benefit in Kind on diesel company cars

 

 

VAT

  • VAT registration threshold will not be reduced for the next two years, and will be maintained at £85,000.
  • Clamp down on VAT fraud committed by on-line retailers

 

Property

First-time buyers – stamp duty abolished on homes up to £300,000.

 

Technology

 

    • £20bn of new investment in UK knowledge-intensive industries.
    • £2.5bn from the business bank.
    • Encourage pension fund investment
    • Boost to Enterprise Investment Schemes.
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Key Points Spring Budget 2017

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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Married Couples Allowance

Transfer unused tax allowance to save up to £212.00 in tax year 2015/16

If you are a married couple or are in a civil partnership, you may qualify for couples tax relief worth up to £212 in 2015/16.

Who does this apply to?

This tax relief is available to married couples and couples in a civil partnership where one partner earns less than £10,600 and the other partners income is below the 40% tax threshold.

One of us is self employed, are we still eligible?

This tax relief is available whether your income is from employment, self-employment, pension income, savings or a combination of these; provided your total income is within the allowable bands.

The 2015/16 tax year is nearly over, can we still apply?

Yes. You can register your interest with HMRC by clicking on this link https://www.gov.uk/marriage-allowance. If you register before the end of the current tax year, and you and your partner qualify, then you can claim entitlement for the full tax year.

How will we know if we are eligible?

1. To benefit from the Married Couples Allowance the higher earning partner/ spouse must have earnings of between £10,601 and £42,385 in the 2015/16 tax year.
2. Both members of the couple must have been born on or after 6 April 1935. There is a slightly different allowance available if you were born before this date.
3. The lower earning partner/ spouse must earn less than £10,600 in the 2015/16 tax year. The maximum relief will be available where the lower earning partners total taxable income is £9,540, or lower in 2015/16. If the lower income earning partners income falls between £9,540 and £10,600, then the amount of relief available to transfer across to the higher earning partner/spouse will be reduced accordingly.

If you would like to more about how this tax relief might benefit you please contact us at JSR Chartered Accountants.

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Budget 2016 – Key Points

Sugar levy on soft drinks

This aims to raise £520m in a two-part levy on companies – one for total sugar content above 5g per 100ml and one for drinks with more than 8g per 100ml – to be introduced in two years’ time. Pure fruit juice and milk are excluded. It will be used to fund sport and longer school days.

Tax allowance

  • An increase to £11,500 by next April.
  • A reiterated target to reach £12,500 by 2020. (It will be £11,000 from this April.)
  • An increase in the 40p tax threshold to £45,000 from next April. (£43,000 from this April.)

 

Savings

  • Tax relief on financial advice.
  • “Help to save” for lower income savers.
  • From April an increase in the Isa limit to £20,000.
  • A new lifetime Isa for £4,000 of savings.

Fuel duty

Frozen for the sixth consecutive year, saving £75 for the average driver.

 

Oil and gas

The industry gets £1bn of tax cuts as the supplementary charge on oil and gas is cut from 20% to 10%.

 

Climate change

  • An increase in the climate change levy from 2019.
  • An end to the carbon reduction commitment energy efficiency scheme.
  • £730m to back renewables.

 

Growth

Revised down for 2016 to 2% compared with 2.4% at the time of the autumn statement for 2015 and 2016, and revised down to 2.2% in 2017 (2.5%) and 2.1% in each year after that (previous forecasts for 2.4% in 2018 and 2.3% in each of 2019 and 2020).

 

Inflation target

The remit remains at 2% for the monetary policy committee and the Bank of England is asked to be particularly vigilant in the face of market turbulence.

 

Cuts

The chancellor is aiming for a further £3.5bn of savings in 2019-20.

Deficit

A surplus of £10.4bn is predicted in 2019-20 and then £11bn the year after.

 

Tax avoidance

  • £12bn to be raised over this parliament, including by cracking down on the royalty payments that firms use to shift money to tax havens.
  • This also includes efforts to stop individuals disguising their income as loans and imposing national insurance on termination payments over £30,000 from 2018.

 

Corporation tax

Cut to 17% by April 2020.

But banks are to be hit by restrictions on the amount of profit that they can offset against losses.

Northern Ireland is set to introduce a Corporation tax rate of 12.5% in 2018.

Business rates (England and Wales)

  • The threshold for small business rate relief is to increase from £6,000 to £15,000.
  • From April next year 600,000 small businesses will pay no business rates.
  • London gets full retention of its business rates next April, three years earlier than planned.

 

Stamp duty

To raise £500m a year, from Thursday, commercial stamp duty will be zero on properties up to £150,000 and 2% on the next £200,000, but a top rate of 5% on £250,000.

Homelessness

£115m to reduce rough sleeping.

 

Flood defences and insurance

A £700m increase for flood defences and a 0.5% increase in the insurance premium tax to 10%.

 

Culture

  • Cathedral repairs fund gets an extra £20m.
  • Tax breaks for galleries that go on tour.

Education (England and Wales)

  • Schools to become academies.
  • Focus on northern schools.
  • Teaching maths to 18 for all pupils.
  • £500m for national funding formula.

Tobacco

Tobacco Duty will rise by 2% and hand rolling tobacco will rise by an additional 3% from 6pm on 16 March 2016

 

Alcohol

Duty on beer, cider and whisky is frozen.

 

Capital gains tax

For commercial properties the higher rate of Capital Gains Tax will be cut from 28% to 20% and the basic rate from 18% to 10%. This will take effect from April 2016., but no change for properties.

 

Overseas aid budget

Budget will be “readjusted”, saving £650m in 2019-20.

Pensions

Increase in contributions from public sector employers.

 

Self Employed National Insurance

Class 2 National Insurance contributions to be scrapped for self-employed workers from April 2018. Currently, self-employed people have to pay Class 2 NICs at £2.80 per week if they make a profit of £5,965 or over per year. They also pay Class 4 NICs if their profits are over £8,060 per year. From April 2018, they will only need to pay one type of National Insurance on their profits, Class 4 NICs

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National Living Wage

From the 1 April 2021 the National Living Wage (NLW) for workers aged 23 (previously 25) and above will increase to £8.91 per hour. The current National Minimum Wage for those under the age of 23 will continue to apply and the rates set from 1 April 2021 can be found here National Minimum Wage Rates .

Previous posts…

The 1 April 2018 the National Living Wage (NLW) for workers aged 25 and above will increase to £7.83 per hour. The current National Minimum Wage for those under the age of 25 will continue to apply and the rates set from 1 April 2018 can be found here National Minimum Wage Rates .The Government’s objective is to have a National Living Wage of over £9 by 2020.

•The 1 April 2017 the National Living Wage (NLW) for workers aged 25 and above will increase to £7.50 per hour. The current National Minimum Wage for those under the age of 25 will continue to apply and the rates set from 1 April 2017 can be found here National Minimum Wage Rates .The Government’s objective is to have a National Living Wage of over £9 by 2020.

 

•The 1 April 2016 will see the introduction of the governments new National Living Wage (NLW) for workers aged 25 and above, by introducing a premium on top of the National Minimum Wage (NMW). From April 2016, the NLW will be set at £7.20 an hour. The current National Minimum Wage for those under the age of 25 will continue to apply and the rates set from 1 October 2016 can be found here National Minimum Wage Rates .The Government’s objective is to have a National Living Wage of over £9 by 2020.

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Budget 8 July 2015 – Key Points

Todays budget at a glance

 

Welfare and pensions

  • Working age benefits to ne frozen for four years, including tax credits and local housing allowance
  • Rents in social housing sector will be reduced by 1% a year for the next four years
  • Higher-income households in social housing will be required to pay rents at the market rate
  • Tax credits and Universal Credit to be restricted to two children, affecting those born after April 2017
  • Reduce earnings level for tax credits withdrawal from £6,420 to £3,850.
  • Disability benefits will not be taxed or means-tested
  • 18-21-year-olds will not be entitled to claim housing benefit automatically, with a new “earn to learn” obligation
  • Employment and Support Allowance payments for claimants deemed able to work to be “aligned” with Jobseeker’s Allowance for new claimants
  • pensions tax allowance to be tapered away to a minimum of £10,000 from next year
  • Dividend tax credit to be replaced with a tax free allowance of £5,000 of dividend income for all taxpayers. The rates of dividend tax will be set at 7.5%, 32.5% and 38.1%

 

Fuel

  • New VED bands for new cars to be introduced from 2017, pegged to emissions – 95% of car owners will pay £140 a year.
  • Fuel duties frozen for the remainder of this year

 

Personal Taxation

  • Personal tax allowance to rise to £11,000 next year
  • The point at which people start paying income tax at 40p to rise from £42,385 to £43,000 next year
  • National living wage to be £9 per hour by 2020 for people 25 and over, starting from £7.20 per hour from next April
  • Increase in inheritance tax threshold to £1m for married couples by 2017

 

Business

  • Corporation tax cut to 19% in 2017 and 18% by 2020
  • New apprenticeship levy on all large firms- firms that offer apprenticeships can get more back than they put in

 

Health and education

  • NHS will receive a further £8bn by 2020 (in addition to the £2bn already announced)
  • Maintenance grants for students paid to students with family income below £42,000 to be scrapped and converted into loans from 2016/17, repayable on incomes over £21,000
  • The maintenance loan will increase to £8,200

 

Housing

  • Mortgage interest relief for buy-to-let homebuyers to be restricted to basic rate of income tax
  • Rent-a-room relief scheme to rise to £7,500

 

Other

  • The cost of funding free TV licences for the over-75s will be transferred from the government to the BBC between 2018 and 2021
  • The annual household benefit cap will be reduced to £23,000 in London and to a lower level in the rest of Britain.
  • A consultation will take place on changing Sunday trading laws
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Budget 2015 – The Key Points

The Key Points from todays budget are:

  • Personal tax-free allowance will be increased to £10,800 in April 2016, and to £11,000 in April 2017.
  • Beer duty to be cut for the third year running, with 1p off the price of a pint. Cider duty to be cut by 2%. Duty on scotch whisky and other spirits to be cut by 2%. Wine duty to be frozen.
  • Pension pot lifetime allowance to be reduced from £1.25m to £1m from next year, saving £600m annually.
  • National Minimum Wage will rise by 20p an hour to £6.70 from October.
  • Corporation tax to be cut to 20% in two weeks’ time.
  •  “Help to buy ISA” will be launched for first-time buyers. For every £200 saved for a deposit, the Government will top it up with £50.
  • Personal savings allowance to be launched, taking 95% of Britons out of savings tax altogether.
  • Fuel duty increase scheduled for September is cancelled.
  • Employers’ National Insurance contributions for under-21s to be abolished from this April, and for young apprentices from April 2016.
  •  Class 2 National Insurance contributions for the self-employed to be abolished entirely in the next parliament.
  • Annual tax return to be abolished altogether.
  • “More generous” tax credits for TV and film, expanded support for video games industry and new tax credit for orchestras.
  • Trebling in £15m fund for church roof appeals, and extension to £8,000 in automatic gift aid to benefit 6,500 small charities.
  • Review on the use of deeds of variation to avoid inheritance tax to report by the autumn.
  • Charities for British servicemen and women to receive £75m, funded by Libor fines.
  • Up to £600m to clear new spectrum bands for further auctions, improving mobile phone coverage nationwide, including in remote communities.
  • Funding for wifi in public libraries and new national plan for ultra-fast broadband to nearly all homes in the country.
  • New investment in transport and regeneration across London, and funding to address acute housing shortages in the capital.
  • Automotive industry to receive £100m in investment in the race to driverless technology.
  • North Sea oil industry to receive £1.3bn in support through four new measures.
  • £1m to buy defibrillators for public places, including schools.
  • Expanded support for creative industries, including a new tax credit for orchestras.
  • Consultation on tax support for local newspapers.
  • Measures on tax avoidance and evasion to raise £3.1 billion over the forecast period.
  •  Legislation next week on diverted profits tax aimed at multinationals shifting profits offshore, with policy to take effect at the start of April.
  • The Office for Budget Responsibility says Britain’s economy grew by 2.6% last year.
  • Growth forecast for 2015 revised up by 0.1% to 2.5%, with unemployment set to fall by 0.1% from 5.4% to 5.3%.
  • OBR revises 2015 inflation forecast down to 0.2%.
  • Sale of £13bn of mortgage assets held by the Government after the bailout of Northern Rock and Bradford & Bingley is going to be launched. This will be used to pay down the national debt.
  • Bank levy increased to 0.21%, raising an additional £900m a year. New banking taxes to raise £5.3bn across forecast period.
  • Farmers will be allowed to average their incomes for tax purposes over five years.

 

 

 

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Automatic enrolment. What does it mean for you?

Under new law introduced in 2012, all employers must offer a workplace pension scheme and automatically enrol eligible workers in it. This requirement has applied to larger employers since October 2012 and by 2018 will apply to all employers.

By 2018 all employers will have automatically enrolled their eligible workers into a workplace pension scheme unless the worker opts out. As a result, many more people will be able to build up savings to help cover their retirement needs.

Who will be automatically enrolled?

Whether you work full time or part time, your employer will have to enrol you in a workplace pension scheme if you:

  • Are not already in a suitable workplace pension scheme
  • Are at least 22 years old, but under state pension age
  • Earn more than £10,000 a year (tax year 2014-15), and
  • Work in the UK

As long as you meet these criteria you’ll also be covered if you’re on a short-term contract, or an agency pays your wages, or you’re away on maternity, adoption or carers’ leave.

Do I have any choice about being enrolled?

You can opt out of your employer’s workplace pension scheme after you’ve been enrolled. But if you do, you’ll lose out on your employer’s contribution to your pension, as well as the government’s contribution in the form of tax relief.

If you decide to opt out, ask the people who run your employer’s workplace pension scheme for an opt-out form. You must then return your completed form to your employer, not to the people who run the scheme.

If you decide to opt out within a month of being enrolled, any payments you’ve made into your pension pot during this time will be refunded to you.

After the first month, you can still opt out at any time, but any payments you’ve made will stay in your pension pot for retirement rather than be refunded.

You can re-join your employer’s workplace pension scheme at a later date if you want to. And your employer must by law re-enrol you back into the scheme approximately every three years, as long as you still meet the eligibility criteria.

How much will I have to contribute?

There is a minimum total amount that has to be contributed by you, your employer, and the government in the form of tax relief. This total minimum contribution is currently set at 2% of your earnings (0.8% from you, 1% from your employer, and 0.2% as tax relief). In 2017 and 2018, the percentage of your earnings that it is based on will increase.

The minimum contribution applies to anything you earn over £5,772 (in the tax year 2014-15) up to a limit of £41,865. This includes overtime and bonus payments. So if you were earning £18,000 a year, your contribution would be a percentage of £12,228 (the difference between £5,772 and £18,000).

Your employer will let you know how much of your earnings you’ll need to contribute. They may tell you this as a sum of money or as a percentage.

Increases in the minimum contribution

The total minimum contribution is currently set at 2% of your earnings (0.8% from you, 1% from your employer, and 0.2% as tax relief). From October 2017, it will increase as follows:

October 2017 to September 2018: 5% of your earnings (2.4% from you, 2% from your employer, and 0.6% as tax relief)

From October 2018 onwards: 8% of your earnings (4% from you, 3% from your employer, and 1% as tax relief)

 

Find out more on The Pensions Regulator Website

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Autumn Statement 3 December 2014

Key Points

 

Personal taxes

  • Tax free allowance raised to £10,600 next year.
  • Higher rate tax band raised to £42,385.
  • When someone dies, their husband or wife will be able to inherit their ISA tax free.
  • The inheritance tax exemption will cover aid workers who lose their lives dealing with humanitarian emergencies.

 

Corporate taxes

  • A 25pc tax on profits from activity in the UK for companies that shift profits offshore will raise £1bn over the next five years.
  • Business rates to be reviewed.
  • Tax relief for small and medium-sized businesses doubled, and a £45m package of support for exporters.
  • Tax credit for children’s TV producers
  • No employer national insurance on apprentices

 

Property

Stamp Duty reformed to become more progressive, introduces marginal tax rates. Changes come into force from tonight.

  • Up to £125,000 – no tax
    Up to £250,000 – 2pc
    Up to £925,000 – 5pc
    Up to £1.5m – 10pc
    Above that – 12pc

Stamp duty cut for 98pc of homebuyers who pay it, you pay more if you buy anything above £937,000.

 

Health

  • Confirmed £2bn a year extra spending on NHS
  • Extending £2,000 employment allowance to carers

 

Travel

  • Fuel duty frozen again
  • Air passenger duty for children under 12 abolished from next year, and for children under 16 the year after

Bank fines

  • £1.2bn of forex bank fines for GP services
  • Libor fines go to emergency services, Gurkhas, £10m for veterans with hearing problems, new helicopters and VAT refunds for search and rescue

 

Education

  • £10,000 student loans for postgraduate students doing masters degrees

 

Devolution

  • Northern Ireland to set corporation tax
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