The Chancellor has announced the date for the first Budget in more than a year. What can you expect?
What tax adjustments are expected?
The Conservatives’ manifesto mentioned a 1% increase to R&D tax credits and the structures and buildings allowance, along with a £1,000 increase to the employment allowance. The party promised that it won’t increase the rates of income tax, VAT and NI and will eventually increase the NI threshold to £9,500. The manifesto did include a 3% stamp duty land tax surcharge for non-UK residents buying UK residential property.
Are any surprises on the cards?
The government has committed to a public spending boost and this must be paid for. Cancelling the reduction to corporation tax rates will not cover everything so perhaps we will see increases to capital gains tax. Entrepreneurs’ relief is expected to get more complicated as the government tightens up the rules.
The Chancellor has been open about his dislike for inheritance tax, but the manifesto was silent on this area. Again, we are likely to see tweaks to this tax over the term of this government. Finally, the government will need to address the tapering of the pensions annual allowance, which led to a “sticking plaster” being used to keep the NHS afloat this winter. There have been calls for the tapering provisions to be scrapped and changes made for NHS doctors only will be highly unpopular and will increase the complexity of the rules.