- 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.
- The income tax additional rate threshold will reduce from £150,000 to £125,140 from April 2023.
- Personal tax thresholds – ie personal allowance, basic and higher rate thresholds for income tax – are maintained until April 2028 at a current level of £12,570 and £50,270.
- Basic rate of income tax will be maintained at 20%. This was previously announced to be reduced to 19%, which will not go ahead from 2023.
- The national insurance thresholds for all classes will be maintained until April 2028 at the current level.
- The employment allowance is set to the current level of £5,000.
- The temporary 1.25% increase from 6 April 2022 in national insurance rates has been abandoned from 6 November 2022. The Health and Social Care Levy is no longer going ahead. The introduction of a separate Health and Social Care Levy tax in April 2023 has been cancelled too.
- Dividend allowance is reduced from £2,000 to £1,000 from April 2023 and to £500 from April 2024.
Capital gains tax:
- The annual exemption amount for capital gains tax for individuals will change from £12,300 to £6,000 from April 2023, then £3,000 from April 2024.
- The VAT registration and deregistration thresholds at £85,000 will not change for a further period of two years from 1 April 2024.
It's time to get your annual accounts sorted. Sign up for QAccounting’s fantastic accounting service today.
National Living Wage
- From 1 April 2023, the government will increase the National Living Wage (NLW) by 9.7% to £10.42 an hour, for those aged 23 and over.
- Inheritance tax nil-rate band and residence nil-rate band – thresholds are maintained at the current level until April 2028.
- Stamp Duty Land Tax (SDLT) cuts for England and Northern Ireland will remain in place until 31 March 2025. On 23 September 2022, the government increased the nil-rate threshold of SDLT from £125,000 to £250,000 for all purchasers of residential property in England and Northern Ireland and increased the nil-rate threshold paid by first-time buyers from £300,000 to £425,000.
- The maximum purchase price for which First Time Buyers’ Relief can be claimed was increased from £500,000 to £625,000. This will now be a temporary SDLT reduction which will remain in place only until 31 March 2025.
Annual Tax on Enveloped Dwellings
- The annual chargeable amounts for the ATED will be uplifted by the September CPI figure of 10.1% for the 2023-24 ATED charging period.
Annual Investment Allowances
- Annual Investment Allowance has been confirmed at a permanent rate of £1 million from 1 April 2023.
- The chancellor has announced electric vehicles will no longer be exempt from Vehicle Excise Duty from April 2025
- Company car taxes are under review and are going to be set up until April 2028:
– Electric and ultra-low emission cars emitting less than 75g of CO2 per kilometer will increase by 1 percentage point in 2025-26; a further 1% in 2026-27 and a further 1% in 2027-28 up to a maximum appropriate percentage of 5% for electric cars and 21% for ultra-low emission cars.
– Rates for all other vehicles bands will be increased by 1 percentage point for 2025-26 up to a maximum appropriate percentage of 37% and will then be fixed in 2026-27 and 2027-28.
Tax Payment Dates and Estimating the Values of Tax Payable
The article outlines the typical tax payment dates and methods of estimating the values of tax payable for each type of tax including: VAT, PAYE, NIC, CIS, Corporation Tax, and Dividend and Personal Taxes
Corporation Tax Rate Changes
Rishi Sunak has proposed a number of changes to the way that Corporation Tax will be calculated and applied. Learn more.
P11D Reporting Benefits In Kind and Non-Allowable Expenses to HMRC
In advance of the deadline for the submission of these returns (6th July each year), we wanted to give our clients some guidance as to what these are and when they are required to be submitted to HMRC.