Following on from the Chancellor’s first and last Spring Budget, we are pleased to provide you with our summary of the key announcements, along with our tax tables for the 2017/18 tax year:
- The tax-free dividend allowance will be reduced from £5,000 to £2,000 from April 2018.
- Class 4 national insurance contributions for self-employed workers will increase to 10% in April 2018 and rise again, to 11%, from April 2019.
- Unincorporated businesses and landlords with a turnover below the VAT threshold will have until April 2019 before they are required to implement ‘Making Tax Digital’.
Among the key changes to note for this year are:
- The Chancellor confirmed that corporation tax will be cut to a rate of 19% from April 2017 and it will be further reduced to 17% in 2020.
- The personal allowance will rise to £11,500 in April 2017 and to £12,500 by 2020 and the higher rate income threshold will rise to £45,000, although special rules will apply in Scotland.
- Individual landlords’ tax relief for finance costs will be restricted to basic rate tax – to be phased in over four years from April 2017.
Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.