Autumn Statement 2012

On Wednesday 5th December 2012, Chancellor George Osbourne gave the Autumn Statement, a sort of ‘mini budget’, announcing new tax measures, as well as economic measures. The main points of the Autumn Statement are summarised below.

Personal Tax

  • An increase in the personal allowance for 2013/14 from £8,105 to £9,440
  • A fall in the higher rate tax band for 2013/14 from £42,475 to £41,450
  • A reduction in the additional tax rate from 50% to 45% where income exceeds £150,000
  • For dividends, the additional rate is reduced from 42.5% to 37.5% where income exceeds £150,000
  • For 2014/15 and 2015/16, the higher rate tax band will increase by 1% to £41,865 and £42,285 respectively
  • For 2014/15, the annual allowance for pensions tax relieved savings will be reduced from £50,000 to £40,000
  • For 2014/15, the lifetime allowance for pensions tax relieved savings will be reduced from £1.5million to £1.25million
  • The overall ISA savings limit will increase to £11,520 from April 2013
  • Child benefit to rise by 1% for two years from April 2014

 Employment Tax

  • From 6th April 2013, the emissions bands for taxable benefits will be shifted down 5g/km
  • Real Time Information will be introduced from April 2013, see our other article here

 Business Tax

  • Reduction in the main rate of Corporation tax from 1st April 2013 to 23%, then 21% from 1st April 2014, with the small company rate remaining at 20%.
  • A temporary tenfold increase in the Annual Investment Allowance for 2 years from 1st January 2013 from £25,000 to £250,000, which allows a 100% deduction of plant & machinery purchases
  • A 100% first year allowance (FYA) for low emissions cars purchased by a business (under 110g/km), which will continue for a further two years from 1st April 2013 but emissions must be below 95g/km.
  • 18% writing down allowance for cars with emissions between 111-160g/km, with the threshold lowering to 130g/km from 1st April 2013

 Other Taxes & Benefits

  • The CGT annual exemption will increase to £11,000 for 2014/15 and £11,100 for 2015/16
  • The inheritance tax nil rate band will increase to £329,000 for 2015/16
  • Child benefit to rise by 1% for two years from April 2014
  • Basic state pension to rise to £110.15 per week from next year
  • The planned 3p increase in fuel duty for January has been cancelled

Please contact us for further information on how the Autumn Statement will affect you and your business.

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