24 November 2017
The Autumn Budget 2017
Philip Hammond’s first Autumn Budget, which replaced the Autumn Statement, focused on positives such as job creation, help for first time buyers and a boost to R&D.
The Chancellor also announced a series of tax measures that will have implications for individuals and businesses.
So, what were the key points in the Autumn 2017 Budget?
- Personal Tax:
The personal allowance for income tax, currently £11,500, will be raised to £11,850 in 2018/2019. The basic rate of tax will also increase, with the lowest band rising from £33,500 to £34,500. The Capital Gains exemption will also increase from £11,500 to £11,700 for 17/18. As previously mentioned by the Chancellor, the dividend 0% rate band will be dropped from £5,000 to £2,000.
- Enterprise Investment:
A series of measures geared towards increasing investment in knowledge-intensive companies will come into force from 6th April 2018. For example, the limit on the amount an individual can invest under the Enterprise Investment Scheme (EIS) will be doubled to £2 million.
- Business Tax:
The rate of Corporation tax is still 19%. Perhaps the most significant change which will impact buy-to-let landlords using a corporate vehicle is that the Indexation allowance on the disposal of capital assets by a company will be frozen from 1 January 2018.
- Research & Development:
Businesses looking to invest in R&D will receive additional support. The R&D expenditure tax credit will be increased from 11% to 12% from 1st January 2018 and more will be done to increase awareness of R&D tax credits among SMEs.
As previously announced, VAT registered businesses will be required to keep digital records of VAT and report digitally to HMRC from April 2019. Although there was talk that they may fall, VAT registration limits will be frozen for two years whilst a consultation period occurs.
- Capital Tax:
Subject to consultation, Entrepreneur’s Relief – aimed at the owners of unincorporated businesses, working directors and employees of companies who own at least 5% of the share capital in the company – could be extended to those whose holding in a company is below the 5% current threshold.
Download our in-depth summary of the new tax measures announced in the Autumn Budget. This includes a breakdown of proposed rates and allowances for the next tax year.
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