The new Chancellor announced his mini budget early this morning. While new measures were introduced, several planned tax increases were cancelled.
Basic rate of tax reduced from 20% to 19% from April 2023.
There has been no increase in personal allowances or the level at which the 40% tax rate starts.
The 45% top rate of tax will be abolished from April 2023.
The NIC increase of 1.25% which started in April 2022 is cancelled as from 6 November and the Health & Social Care Levy which would replace it in April 2023 will no longer go ahead.
The level at which Stamp Duty starts increases from £125,000 to £250,000, and for 1st time buyers increases to £425,000.
IR35 reforms to be repealed.
Corporation Tax increase cancelled, so the rate for small businesses will remain at 19%.
Annual Investment Allowance reduction cancelled.
What Does It Mean For Your Income
The cancelling of the NIC increase could lead to “savings” of up to £330.
The reduction of basic rate tax to 19% and the abolition of the 45% rate will lead to the the below savings, which increase the more you earn.
Annual Income Saving on Income Tax for 2023/24 per annum