Here are the key takeaways from this year’s Spring statement
Income Tax and National insurance
The primary national insurance threshold and lower profits limit have been increased from £9,880 to £12,570 which brings both thresholds in line with the income tax threshold. The increase is set for July 2022 which should make for an interesting payroll run just as most payroll professionals were getting over the furlough calculations.
The employment allowance will increase to £5,000 from April and the basic rate tax rate will be reduced by 1% to 19% from April 2024.
The 1.25% “NHS Tax” will remain.
To help small businesses, the chancellor announced an increase to the annual investment allowance from £200,000 to £1 million until March 2023.
R&D tax credits are to be made more generous to boost UK productivity.
Cost of living
With the cost of living set to raise even further, a temporary 12 month cut to duty on petrol and diesel was announced of 5p per litre.
Households installing energy saving items to their homes like solar panels and insulation will have 0% VAT on the items as opposed to 5% VAT.
Has the spring statement delivered to your expectations?