BRIEF HIGHLIGHTS OF TAX AND NATIONAL INSURANCE CHANGES:
- Corporation Tax rates from 1 April 2023:
>19% for taxable profits below £50,000 (small profits rate)
>25% for taxable profits above £250,000 (main rate)
Marginal Relief available to be tapered between the small profits rate and the main rate.
- Super deduction Allowances of 130% confirmed as ending 31st March 2023.
- New 100% Capital Allowance first year tax relief (in addition to current AIA allowances) from 1 April 2023 to 31 March 2026 for Limited Companies only.
- Special rate expenditure first year allowances of 50% for Limited Companies only until 31 March 2026.
- Pension Lifetime Allowance to be abolished. Lifetime allowance charge will be removed from 6 April 2023 onwards.
- Pension contribution Annual Allowance increased from £40,000 to £60,000 per tax year from 6 April 2023.
- No change to Personal Income Tax and National Insurance contributions thresholds, these remain to be fixed at their current rates until April 2028.
- National Living Wage to increase from £9.50 an hour for over-23s to £10.42 from 1 April 2023.
- NMW rates to apply from April 2023:
>21 to 22 year olds from £9.18 to £10.18 per hour
>18 to 20 year olds from £6.83 to £7.49 per hour
>16 to 17 year olds from £4.81 to £5.28 per hour;
- The Income Tax additional rate threshold (ART) lowered to £125,140 from 6 April 2023. The ART for non-savings and non-dividend income will apply to taxpayers in England, Wales, and Northern Ireland.
- The Dividend Allowance reduced to £1,000 from April 2023, and to £500 from April 2024.
- The Capital Gains Tax Annual Exempt Amount will reduce to £6,000 from April 2023 and to £3,000 from April 2024.