Bit disappointed to be honest after the big build up this week. National Insurance (NI) cut was expected, but there’s not much else to shout about in the latest Autumn Statement.
No changes to income tax allowances resulting in more people paying tax where salaries are more than likely increasing, I still don’t understand why all individuals should not get a personal allowance, instead it gets removed once earning over £125k.
Dividends allowance – It’s criminal in my opinion, how the dividend allowance that is reducing from £2k (2023), to £1k (2024) and then to £500 (2025) has not be re-considered yet.
No changes to VAT. While I don’t like the idea, if VAT was increased, would this not be a better way to reduce inflation? This effecting everybody and not just those that are borrowing.
Good news on the permanent corporation tax relief on plant and machinery being purchased. In my opinion, most small owner-managed businesses keep a very close eye on cashflow and would only purchase assets if necessary and not just to reduce corporation tax, however, if an asset is required – then purchasing before the company year-end would be good and advisable tax planning.
More help still needed to save our pubs even with the freeze on alcohol duty until August 2024. Can individuals still afford to spend £6 on a pint in a pub when its £1 for a can in supermarket?
Few questions received from clients already:
- Should we defer our December staff bonus until January = Yes, absolutely to save the 2% NI reduction in January, but you would need to consider if a bonus is included in staff contracts to be paid each year in December.
- Great news regarding NI, being a high earner, I will receive 2% more in my pay each month = No sorry, the NI saving will only be up to the basic rate band being £50,270 (including PA), over this figure will remain at 2%.
Graham McNeill – Partner