Autumn 2022 Budget Notes

Autumn 2022 Budget Notes

Below is a summary of some of the key points announced recently.

Income Tax and National Insurance

• The current Income Tax and National Insurance thresholds are to be frozen at their current rates until April 2028.
• The additional rate Income Tax threshold, whereby income over £150,000 is currently taxed at 45% will be lowered to £125,140 from April 2023.
• The National Insurance secondary threshold will increase to £9,100 from April 2023 and remain fixed until April 2028. Employer’s National Insurance will be payable on any employees earning over this amount each year, however, small employers will receive the Employment Allowance.
• The Dividend Allowance, currently £2,000 per year, will reduce to £1,000 from April 2023. It will then be further reduced to £500 from April 2024.
• The Capital Gains Tax annual exemption is being cut from the current 2022/23 rate of £12,300 to £6,000 from April 2023. It will be further reduced to £3,000 from April 2024.
• The Inheritance Tax (IHT) nil-rate band and residence nil-rate bands will be fixed at their current rates until April 2028.

Corporation Tax

• The Research and Development Expenditure Credit rate will increase from 13% to 20% for expenditure on or after 1^st April 2023. The SME additional deduction will decrease from 130% to 86% and the SME credit rate will decrease from 14.5% to 10%.
• From April 2023, the rate of Corporation Tax will increase from 19% to 25%.

Stamp Duty Land Tax (SDLT)

• In September this year, the government increased the nil-rate thresholds of SDLT from £125,000 to £250,000 for all purchasers of residential property in England and Northern Ireland and increased the nil-rate threshold for first time buyers from £300,000 to £425,000. This will remain in place until 31^st March 2025.

Taxation of Electric Vehicles

• From April 2025, electric cars, vans and motorcycles will begin to pay Vehicle Excise Duty in the same way as petrol and diesel vehicles.

Feel free to contact us should you have any queries or require any further clarification.