Click here to understand the 2023 Autumn Statement

Click here to understand the 2023 Autumn Statement

The 2023 Autumn statement from Jeremy Hunt was delivered yesterday, 22nd November, and is likely to be the last one before the next election which is predicted to happen no later than early November 2024. There was much speculation in the media in the lead up to the announcement regarding Inheritance Tax but that all came to nothing. Unsurprisingly, there were some increases in the tax burden for small businesses employing minimum wage workers as wages try to keep pace with inflation. Tax breaks were few and far between though some relief came in the form of lower NICs for employees and the self-employed. Here’s a quick roundup of the changes affecting individuals and businesses.

Changes in the Autumn Statement 2023 affecting businesses

Personal finances

Income Tax/NI

  • No changes to the income tax rate or employers NI. However, the main rate of NI for employees (Class 1) is reduced from 12% to 10%. Class 2 NICS, currently £3,.45 per week, paid by self-employed earning over £12,570 is abolished from April 2024. Class 4 NICS, paid by self-employed people reduces from 9% to 8% for profits between £12,570 and £50,270 from April 2024.

National Living Wage

  • The National Living Wage increases almost 10% from £10.44 to £11.42 and will also apply for 21–22-year-olds from April 2024.

Benefits

  • In line with September’s inflation, benefits such as Universal Credit will increase by 6.7% from April.

Pensions

  • Full new state pension increases by 8.5% from £203.85 to £221.20 per week.

Other measures

  • All alcohol duty frozen until 1 August 2024.
  • Duty rate on tobacco products increases by 2% above RPI inflation; hand-rolling tobacco rises 12% above RPI
  • Fuel duty remains 52.95p per litre for petrol and diesel.

Businesses/Infrastructure projects

  • The “Full expensing” tax break was made permanent. This allows companies to deduct spending on new qualifying machinery and equipment from profits in the year of purchase rather than getting tax relief over a number of years.
  • 75% business rates discount for retail, hospitality and leisure businesses extended for further year
  • Funding of £4.5bn to attract investment to green energy, aerospace, life sciences and zero-emission vehicles.
  • Around £500m over the next two years to fund artificial intelligence innovation centres.
  • New investment zones announced for the West Midlands, East Midlands and Greater Manchester, Wrexham and Flintshire
  • Additional £80m for new Levelling Up Partnerships to fund regeneration projects in Scotland

Government spending plans reaffirmed in the Autumn Statement 2023

  • NHS/Social care: budget increased by £14.1bn
  • Education: budget increased by £2bn (as announced last autumn) for 2024/25
  • Defence: budget maintained at 2% of national income
  • Overseas aid: budget maintained at 0.5% of national income for next 5 years, below the official 0.7% target.

For more detailed Autumn Statement 2023 coverage, you can visit the BBC Website.

Understanding the impact for your business

If you’re wondering how the Autumn Statement 2023 might affect your taxation situation, we’re always just a phone call away to help with your questions. Adams Accountancy, the best accountants in Dartford, is here to keep up to date on how the latest development impact you. For a free no-obligation chat, call us on 01322 250001 today.

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