There’s breaking news today, as far as business is concerned. This is because the UK Chancellor, Rishi Sunak, has just announced the 2021 Autumn Budget.
This blog is designed to give you an overview of all the main points, in relation to personal/business tax, VAT and Duties.
Dividends - the dividend allowance remains at £2,000 for 2022/23, however, each of the three tax bands will increase by 1.25%. From the 6th of April 2022, the basic rate for dividends will rise to 8.75%, the higher rate will increase to 33.75%, and the additional rate will be 39.35%.
National Living Wage - the national living wage applicable to over-23s increases by 6.6% from £8.91 to £9.50 an hour, from 1st of April 2022.
Making Tax Digital for Income Tax Self-Assessment - the requirement for sole traders and landlords with income over £10,000, to prepare for Making Tax Digital (MTD), has been delayed by one year. It will now be introduced from 6th of April 2024. General partnerships will not be required to join MTD for income tax self-assessment until 6 April 2025.
Corporation Tax - the UK's main rate of corporation tax will increase to 25% from April 2023.
Company Car Tax - as announced at Budget 2020, company car tax rates already announced for 2022/23 will remain frozen until 2024/25.
Research and Development (R&D) Relief - R&D tax relief reforms will take effect from April 2023, which will expand qualifying R&D expenditure to include data and cloud costs.
VAT-Registration Thresholds - the VAT-registration and deregistration thresholds should remain unchanged until 31st of March 2024.
The Second-Hand Motor Vehicle Export Refund - businesses that buy second-hand vehicles from Great Britain (to sell in Northern Ireland or the EU) will be able to recover an amount equivalent to the VAT that could be included in the vehicle’s purchase price.
Vehicle Excise Duty (VED) - rates for heavy goods vehicles will remain frozen and the HGV levy will continue to be suspended for another 12 months from 1 August 2022.
Fuel Duty - fuel duty rates will remain frozen for 2022/23.
Alcohol Duty - alcohol duty rates remain frozen for 2022/23 but the Government announced its proposals for reform of this tax, with the aim of simplifying an outdated system.
Tobacco Duty - from 6pm on 27 October 2021, the duty rates on all tobacco products will increase by RPI plus 2%, on hand-rolling tobacco products by RPI plus 6% and the minimum excise tax to RPI plus 3%.
If you would like a more in-depth summary of the 2021 Autumn Budget, you can read our full overview here.
Or, if you would like more information on a specific category covered in this blog, you can refer to the main blog page, where you will find posts covering business tax, personal tax, VAT, and duties/other announcements in greater detail.
If you have any queries regarding Sunak’s Autumn Budget, then please do get in touch with our team of dedicated Gow accountants, who will be more than happy to clarify any aspect that you’re unclear on.
Simply call 01254 589799 today.