Budget Booklet 2018

Chancellor Philip Hammond delivered the Autumn Budget to Parliament yesterday just five months before Britain is due to leave the European Union. He stated that the era of austerity is “finally coming to an end” but that the focus is continuing to reduce debt and borrowing.

The key announcements were as follows:-

  • An earlier than planned increase in the personal allowance for income tax from £11,850 for 2018/19 to £12,500 for 2019/20
  • Higher rate threshold for income tax to rise from £46,350 in 2018/19 to £50,000 in 2019/20
  • The government will not proceed with the previously announced plan to abolish Class 2 NIC from April 2019
  • From 6 April 2019, the annual exempt amount for capital gains tax for individuals increases from £11,700 to £12,000
  • Corporation tax rates will be reduced from 19% to 17% for all companies from 1 April 2020
  • The Annual Investment Allowance will be increased from £200,000 to £1m for two years from 1 January 2019
  • From April 2019 the writing down allowance on the special rate pool for plant and machinery will be reduced from 8% to 6%
  • From 29 October 2018 a new structures and buildings allowance has been introduced
  • Minimum qualifying period for Entrepreneurs’ Relief increased for disposals from 6 April 2019 from one year to two years
  • From April 2020, the NIC’s Employment allowance will be restricted to employers with an employers NIC liability below £100,000 in the previous tax year
  • From 1 April 2020 the government will legislate a restriction on the use of carried forward capital losses
  • For accounting periods beginning on or after 1 April 2020, a limit will be introduced on the payable tax credit that can be claimed under the R&D SME tax relief
  • From 6 April 2020, IR35 off-payroll rules will be extended to the private sector
  • Business rates relief will apply for retail properties with a rateable value below £51,000 for two years from April 2019
  • The VAT threshold will remain unchanged until April 2022
  • Making Tax Digital will take effect from 1 April 2019 for businesses with a turnover above the VAT threshold for their VAT records but will not be mandatory for other taxes before April 2020
  • From April 2019, the National Living Wage will increase to £8.21 per hour
  • The Pensions Lifetime Allowance will rise to £1,055,000 for 2019/20
  • UK residents will need to make a payment on account of capital gains tax following the completion of a residential property disposal for disposals on or after 6 April 2020

Download your full copy of the Garratts Budget Report 2018.

If you would like to discuss any of the issues raised by the Budget, please do contact us.