Autumn Statement 2023 – Key highlights To discuss any issues or opportunities arising from the Autumn Statement, email enquiries@om.uk or speak to your usual Old Mill contact.
INDIVIDUAL
ECONOMY
BUSINESS
National Insurance
Apprentices
‘Help grow the economy’
Abolishing Class 2 National Insurance – saving selfemployed people £190 a year – cuts tax for nearly 2 million people, protecting those at lowest pay.
£50m of funding announced over the next two years for apprentices in engineering and other key growth sectors.
110 measures are going to be taken to ‘help grow the economy’.
Class 4 National Insurance dropping from 9% to 8%, this will save self-employed people an average of £350 a year. 12% rate of employee National Insurance being cut to 10% from 6th January. 27 million people will be affected, on average Treasury calculates it will save £450 for the average worker. Pensions
Capital Allowances Capital Allowances ‘full expensing’ to be made permanent, giving companies up to 25% Corporation Tax relief for investment in new IT, machinery and equipment. Business Investment Overall, increasing business investment by £20bn a year for the decade, nearly 1% of GDP. Innovation
April 2024 – Triple lock for pension committed in full. State pension will increase by 8.5% £221.20 a week, worth up to £900 more a year. Minimum Wage Minimum wage increasing from £10.42 -> £11.44 per hour. Rise of 9.8%, worth up to £1,800 for a full-time worker. New rate to apply to 21 and 22-year-old workers for the first time, rather than just those 23 and over. Tax Returns Tax returns for individuals - from the tax year 2024-2025, individuals with only Pay As You Earn income will not be required to file a return, regardless of how much they earn. This change removes the requirement for up to 338,000 taxpayers to submit a return, says HMRC.
BENEFITS Universal Credit Universal Credit and other benefits going up by 6.7% - average increase of £470 for 5.5 million households.
Research & Development (R&D) tax regimes to be merged from April 2024. Tax position for R&D “intensive” companies improved, including the threshold for what makes a company R&D “intensive”. Cash Basis Cash basis accounting for sole traders and partnerships to be made the default from 6 April 2024. This will apply rather than the accruals basis, regardless of level of turnover, but can be opted-out.
Inflation Core inflation now 4.6%, half its peak last Autumn (2022). Debt Net debt predicted to be 94% by end of 5-year forecast period, 98.6% next year. Public Sector Borrowing Public sector borrowing set to fall from 4.5% this year to 1.1% in 2028/29.
OTHER POINTS GDP Defence Spending Government will meet 2% of GDP defence spending. UK Artificial Intelligence Additional £500m funding for UK artificial intelligence – this follows the success of supercomputing centres in Edinburgh and Bristol.
DUTIES Fuel Duty Fuel duty to remain the same at 52.95p per litre for petrol and diesel after the Chancellor announced a 5p cut for 12 months in March. Alcohol Duty Alcohol duty frozen until 1st August 2024 – no increase in duty on beer, cider, wine or spirits.
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