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Autumn Statement on a page: everything you need to know

17 Nov 2022

Here's a summary of the key measures announced in the government's Autumn Statement on 17th November.

Individuals
  • The income tax additional rate threshold will decrease from £150,000 to £125,140 from 6 April 2023
  • The income tax personal allowance will remain at its current rate of £12,570 until 5 April 2028
  • The income tax higher rate threshold will remain at its current level of £50,270 until 5 April 2028
  • The primary threshold for National Insurance Contributions (NICs), as well as the lower profits limit, were increased in July 2022 and will now remain at £12,570 until 5 April 2028
  • The National Insurance upper earnings limit and upper profits limit will remain at £50,270, in line with the income tax higher rate threshold, until 5 April 2028
  • The dividend allowance will reduce from £2,000 to £1,000 from 6 April 2023 and will decrease further to £500 from 6 April 2024
  • The capital gains tax annual exempt amount will be cut for individuals from £12,300 to £6,000 from 6 April 2023 and will reduce again to £3,000 from 6 April 2024
  • The inheritance tax nil-rate band will stay at £325,000, the residence nil-rate band will continue at £175,000, and the residence nil-rate band taper will continue to start at £2million until 5 April 2028
  • As previously announced, making tax digital (MTD) for certain taxpayers within the Income tax self-assessment (ITSA) regime will take effect from April 2024 (from 5 April 2025 for general partnerships with only individuals as partners)
Businesses
  • As previously announced, the planned increase in the corporation tax rate to 25% for companies with profits in excess of £250,000 will go ahead from 1 April 2023, with a small profits rate of 19% for companies below this threshold
  • The rate of Diverted Profits Tax (DPT) will increase from 25% to 31% from 1 April 2023, in line with the increase in corporation tax
  • An online sales tax (OST) won't be introduced at this time
  • For expenditure on or after 1 April 2023, the research and development small and medium enterprises (SME) scheme deduction rate will decrease from 130% to 86% – from the same date, the SME credit rate will also decrease, from 14.5% to 10%
  • Also for expenditure on or after 1 April 2023, the research and development expenditure credit (RDEC) rate will increase from 13% to 20% – as previously announced, the research and development tax reliefs will be reformed by expanding qualifying expenditure to include data and cloud costs, refocusing support towards innovation in the UK, and targeting abuse and improving compliance
  • The government will legislate to implement the OECD Pillar 2 rules for a global minimum corporate tax rate, for accounting periods beginning on or after 31 December 2023
  • From 1 April 2023, large multinational businesses operating in the UK will be required to keep and retain transfer pricing documentation in a prescribed and standardised format, set out in the OECD’s Transfer Pricing Guidelines (Master File and Local File)
  • Business rates relief will increase in 2023/24 for eligible businesses in the retail, hospitality, and leisure sectors from 50% to 75% up to £110,000 per business – multipliers will be frozen in the same period, and from 1 April 2023, business rate bills in England will be updated to reflect changes in property values since the last revaluation in 2017
  • Under the transitional relief scheme, upwards transitional relief will cap business rates bill increases caused by changes in rateable values at the 2023 revaluation – business rates improvement relief will be introduced from April 2024 until 2028, to ensure taxpayers don't see an increase in their rates for 12 months as a result of making qualifying improvements to a property they occupy
  • As previously announced, the annual investment allowance (AIA) will be set permanently at £1 million from 1 April 2023
  • The previously announced Investment Zones programme will be refocused to a limited number of high potential clusters
Employers
  • The National Insurance Contributions Secondary Threshold for employers will be fixed at £9,100 from April 2023 until April 2028
  • As previously announced, the Employment Allowance will be retained at a level of £5,000 pa until 31 March 2026
  • The National Living Wage (NLW) will increase to £10.42 per hour from 6 April 2023 for those aged 23 and over and the National Minimum Wage (NML) will also be increased for younger workers
Property
  • The previously announced Stamp Duty Land Tax (SDLT) increases to nil-rate thresholds will now be temporary and will remain in place until 31 March 2025
VAT
  • The VAT registration (and deregistration) thresholds will be maintained at £85,000 for two further years until 1 April 2026
Environment and energy
  • The Energy Profits Levy (EPL) on oil and gas producers will be extended until 31 March 2028, and from 1 January 2023, the rate will increase from 25% to 35%
  • A new temporary electricity generator levy will be introduced from 1 January 2023, at a rate of 45% on extraordinary returns from low-carbon electricity generators
  • From April 2025, electric cars, vans and motorcycles will be subject to vehicle excise duty (VED)
  • Company car tax rates will increase by one percentage point for electric and ultra-low emission cars for each tax year between 2025 and 2028 up to a maximum appropriate percentage of 5% for electric cars and 21% for ultra-low emission cars
  • The 100% first year allowance for electric vehicle charge points will be extended to 31 March 2025 for corporation tax and 5 April 2025 for income tax purposes - the Energy Price Guarantee, which caps the unit rate of electricity and gas for households, will be adjusted from 1 April 2023 meaning that an average household will pay £3,000 pa until 31 March 2024, up from £2,500 pa
Consultations
  • Regarding the new transfer pricing documentation requirement, the government has announced a consultation on a summary audit trail, which is a questionnaire that businesses would be required to complete that covers the main steps undertaken in preparing the Local File
  • A consultation will take place on the design of a single Research and Development scheme and to understand whether further support is necessary for R&D intensive SMEs
  • The government has announced a consultation on reforming audio-visual creative reliefs with the intention of further incentivising the production of culturally British content and supporting the growth of the audio-visual sectors
  • The government will consult on the Energy Price Guarantee scheme and amending it after April 2023 to cap state support for those who use very high volumes of energy
Avoidance and evasion
  • To address capital gains tax avoidance, shares and securities in a non-UK company acquired in exchange for securities in a UK close company will be deemed to be located in the UK, where an individual has a material interest in both the UK and the non-UK company and where the share exchange is carried out on or after 17 November 2022
  • The government is investing a further £79 million over the next five years to enable HMRC to allocate additional staff to tackle more cases of serious tax fraud and address tax compliance risks among wealthy taxpayers
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