Budget Update - November 2022
Chancellor Jeremy Hunt today delivered his Autumn statement, in which he outlined package worth billions of pounds of tax rises and spending cuts to put the UK "on a balanced path to stability".
We have taken the main points from the statement and outlined these below:
- The threshold at which the 45p tax rate becomes payable has reduced from £150,000 to £125,140
- Maintains freeze on the income tax personal allowance, higher rate threshold, main national insurance thresholds and the inheritance tax thresholds for a further two years - to April 2028.
- Main National Insurance and inheritance tax thresholds also frozen for a further two years, until April 2028
- Tax-free allowances for dividend and capital gains tax also due to be cut next year and in 2024
- UK minimum wage for people over 23 to increase from £9.50 to £10.42 an hour
- Nearly two thirds of properties will not pay a penny more in business rates next year. Thousands of pubs, restaurants and small high street shops will benefit to tune of £14bn over five years.
- Household energy price cap extended for one year beyond April but made less generous, with typical bills capped at £3,000 a year instead of £2,500
- Households on means-tested benefits will get £900 support payments next year
- £300 payments to pensioner households, and £150 for individuals on disability benefit
- Social housing rent increases capped at 7% from next April - instead of 11% due to inflation
Upon reading the statement, McCrea adviser Jonathan Campbell noted the following: ''Today’s Autumn Statement has not really produced any surprises and the general tone of an increased tax burden was expected. Across the UK, the capping of the Income Tax Personal Allowance, the main National Insurance thresholds and Inheritance Tax to 2028, coupled with a reduction in the Capital Gains Tax allowance will result in a higher tax burden over time. This, coupled with changes in the Energy Price Guarantee will likely mean that many households will be worse off. That said, the increase in the National Minimum Wage to £10.42 is welcomed.''
For other changes introduced such as the capping of the Income Tax Higher Rate threshold and the reduction in the Additional Rate threshold to £125,140, these changes do not apply in Scotland and we will have to wait to understand how the Scottish Government will respond.''
How we can help
If you think that your current retirement plans, pensions, long-term investments or overall financial position will be impacted by the changes outlined in the statement, then please do get in touch with us here, call us on 0141 572 1340 or email us at email@example.com.