On Thursday 17 November 2022, Chancellor Jeremy Hunt delivered his Autumn Statement.
Some of the main points to come out of the statement are as follows.
Income tax rates and personal allowances will be frozen until at least April 2028. This means that as wages rise, more workers will start to pay tax or fall into the higher tax brackets.
The threshold at which individuals start paying the 45p top rate of income tax, will be reduced from £150,000 to £125,140.
National Insurance and inheritance tax thresholds will also be frozen until April 2028.
The dividend allowance will be cut to £1,000 from April 2023 and then to £500 from April 2024.
The Capital Gains Allowance will reduce to £6,000 next year with a further reduction the following year to £3,000
The Employment Allowance will remain at £5,000 pa.
From April 2023, the planned increase in the corporation tax rate to 25% for companies with over £250,000 in profits will go ahead. Small companies with profits up to £50,000 will continue to pay corporation tax at 19%.
Companies with profits between £50,000 and £250,000 will pay tax at the main rate reduced by a marginal relief providing a gradual increase in the effective corporation tax rate.
The Annual Investment Allowance has been confirmed at a permanent rate of £1 million from 1 April 2023.
Cost of living support
From April 2023, the minimum wage for over 23’s will increase from £9.50 per hour to £10.42.
There will be new one-of payments of £900 to households on means tested benefits, £300 to pensioner households, and £150 for individuals on disability benefits.
Both pensions and benefits will rise in line with inflation