Updated on 17 November
The new Government’s Growth Plan, better known as the Mini Budget, was presented on 23 September. Since then, Government statements on the 3, 14 and 17 October have reversed almost all of the tax measures set out in the Mini Budget that have not been legislated for in Parliament.
Mini Budget tax measures that are still in place
Stamp duty land tax
From 23 September, changes in stamp duty land tax (SDLT) mean:
- For all home purchases, the threshold from which SDLT must be paid (the nil rate band) doubles to £250,000
- The threshold at which first-time buyers begin to pay SDLT increases to £425,000
- The maximum value of a property on which first-time buyers’ relief can be claimed increases to £625,000
In the Autumn Statement on 17 November, the Chancellor announced that stamp duty cuts announced in the Growth Plan will now be time-limited, ending on 31 March 2025.
National Insurance and the Health & Social Care Levy
From 6 November, the temporary 1.25% increase in National Insurance Contribution (NIC) rates will be reversed. The Health & Social Care Levy announced in September 2021 is being cancelled.
Corporation tax surcharge rate
From April 2023, the bank corporation tax (CT) surcharge rate will be maintained at 8% and the allowance set at £100m.
Employee share schemes
From April 2023, the doubling of the Company Share Option Plan (CSOP) limit will allow businesses to offer employees share options worth up to £60,000.
Venture capital schemes
From April 2023, the criteria of the Seed Enterprise Investment Scheme (SEIS) will be expanded, including allowing firms to raise £250,000 under the scheme.
Annual Investment Allowance
From 1 April 2023, the Annual Investment Allowance (AIA) will be permanently set at £1 million. This will give 100% tax relief to businesses on their plant and machinery investments up to the level of £1 million.
The Government has agreement in principle to establish 38 Investment Zones in England. These areas will have targeted and time-limited tax cuts for businesses, with liberalised planning rules to release more land for commercial and residential property developments. The Government is seeking to agree Investment Zones in Wales, Scotland and Northern Ireland.
Mini Budget tax measures that have been cancelled
Income tax: basic rate cut put on hold
The basic rate of income tax will remain indefinitely at 20p in the pound, until economic circumstances enable it to be reduced.
Income tax: additional rate stays
The 45p additional rate of income tax won’t be abolished.
Corporation tax cut cancelled
From April 2023 the corporation tax (CT) rate will increase from 19% to 25% for firms making more than £250,000 profit.
Dividend tax cut cancelled
The 1.25% increase to dividend tax rates won’t be reversed
Off-payroll working rules stay as they are
The 2017 and 2021 reforms to the off-payroll working rules (also known as IR35) won’t be repealed.
Alcohol duty rate freeze cancelled
The alcohol duty rate won’t be frozen from February 2023 to February 2024.
VAT-free shopping scheme cancelled
Plans for a digital, VAT-free shopping scheme for international tourists aren’t going ahead.
Further measures are expected
Most of the above reversals were announced on 17 October as a bringing-forward of measures from the Medium-Term Fiscal Plan. That fiscal plan will now be incorporated into an Autumn Statement on 17 November which will also contain an OBR (Office for Budget Responsibility) forecast.
In the meantime, to discuss what the retained Mini Budget tax measures mean for you or your business, please get in touch with your usual BKL contact or use our enquiry form.