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The UK’s Autumn Budget 2022 – In Summary

The UK’s Autumn Budget 2022
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    Chancellor Jeremy Hunt delivered his 2022 Autumn Budget live on Thursday in the UK Parliament at 11:30 GMT. The chancellor has announced £24 Billion in tax rises and £30 Billion in spending cuts.

    The Chancellor stated in his opening statement that the budget they plan to deliver looks to tackle the cost-of-living crisis and rebuild the economy. The budget’s priorities will be stability, growth and public service.

    This blog post will share the Key takeaways from this Budget.

    Tax threshold Reduced for Additional rate of Tax

    The additional tax rate currently taxes any individual earning above £150,000 to pay taxes at 45%. The Chancellor has reduced the threshold rates from £150,000 to £125,140, meaning anyone earning above £125,140 will be paying taxes at 45%.

    Freezing Tax Allowances

    The Chancellor has stated that the government plans to maintain the income tax personal allowance, higher rate threshold, main nation insurance thresholds and inheritance tax thresholds for an additional two years till April 2028.

    Dividend Allowance Cuts

    From April 2023, the tax-free allowance for dividends will be reduced from £2,000 to £1,000 and then to £500 in April 2024

    Capital Gains Allowance Cuts

    The Annual Exempted amount for capital gains tax will reduce from £12,300 to £6,000 in 2023 and reduced further to £3,000 in April 2024.

    Electric Cars lose Vehicle Excise Duty Exemption

    Electric cars will no longer be exempt from Vehicle Excise duty from April 2025.

    National Minimum Wage to Increase

    The Chancellor has announced that the national minimum wage will be increased by 9.7% increasing the hourly rate £9.50 to £10.42.

    It is very disappointing to note the tax on Dividends, which is effectively a double taxation!

    This is the time SME’s, Contractors and Freelancers needed help from the Chancellor but they are overlooked!

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