Here are the key tax changes mentioned by the Chancellor in his speech this lunchtime which you may find of interest.
Dividend allowance – the tax free dividend allowance introduced from 6 April 2016 is to be reduced from £5,000 to £2,000 from 6 April 2018. This change is to reduce the tax difference between the self-employed and those working through a company.
National Insurance Increase for self-employed – From 6 April 2018 class 2 NIC will be abolished and class 4 NIC’s will rise by 1% to 10% (with a further 1% from 6 April 2019). The change is designed to bring the employed and self-employed more in line.
Making Tax Digital – As per previous tax chats quarterly reporting to HMRC was to commence in April 2018 for most individuals and the self-employed. In a welcome change, the introduction will be delayed until April 2019 for unincorporated businesses and landlords who have an annual turnover less than the VAT registration threshold, £85,000 from 1 April 2017.
Corporation Tax – As previously announced, rates of corporation tax will reduce to 19% from April 2017 and to 17% from April 2020.
For more information, please contact Lesley Sutton on 01484 550037 or email firstname.lastname@example.org.