On 23 November 2016, the Chancellor of the Exchequer, Philip Hammond delivered his Autumn Statement. Here, we outline the key changes that are set to be introduced.
Tony Flanagan Managing Partner
Corporation Tax for businesses will be reduced from 20% to 19% from 6 April 2017 (as previously announced) and further reduced to 17% in 2020.
There will be no changes to the previously announced increase in personal allowance for UK taxpayers, which is set to rise from £11,000 to £11,500 from 6 April 2017. The Chancellor also restated his commitment to increase the personal tax allowance to £12,500 and the threshold for higher rate taxpayers to £50,000 by the end of the current parliament.
The Chancellor announced that from 6 April 2017, any benefits provided through a salary sacrifice scheme will be treated and taxed as earnings from the employment. Exemptions to this rule will apply to childcare, ‘Cycle to Work’ schemes, pensions and pension’s advice, and ultra-low emission cars.
Furthermore, it was announced that the National Insurance threshold for employees and employers will be aligned at £157 a week. As already announced in the Budget, Class 2 National Insurance contributions will be abolished in April 2018, thus simplifying National Insurance for the self-employed.
Insurance Premium Tax
Insurance Premium Tax will rise from 10% to 12% from June 2017. This may lead to a rise in insurance premiums if insurers choose to pass on this increase to customers.
Taxes on savings
There are no planned changes to the previously announced increases for Isa and Junior ISA allowances. To reaffirm, from 6 April 2017, adults will be allowed to save up to £20,000 into an ISA, while parents and grandparents will be allowed to subscribe up to £4,128 into a Junior ISA.
Property and Housing
Landlords and property rental businesses will take on more costs associated with property lettings with the ban on up-front fees charged by letting agents to prospective tenants. The administration fees associated with securing a tenant for a rental property will be charged to the landlord. No date has been set as yet, however the Chancellor insisted the ban will be introduced “as soon as possible”.
We hope this information is helpful and informative. Please do give us a call if you have any queries or comments and we would be happy to help.
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