Key Points to the Spring Budget 2017
Thursday, March 9, 2017
Philip Hammond delivered his first Budget as Chancellor, yesterday.
Here are the key points:
- Personal tax allowance will increase to £11,500 as planned and to £12,500 by 2020
- As outlined in Autumn Statement 2016, corporation tax will be cut to 19 per cent from April this year and 17 per cent in 2020.
- £435m for firms affected by business rates revaluations, including £300m hardship fund for small businesses who have taken the worst hit.
- Making Tax Digital for unincorporated businesses and landlords with turnovers below the VAT threshold will be delayed until April 2019.
- The main rate of Class 4 National Insurance contributions for the self-employed to increase from 9% to 10% in April 2018 and 11% in April 2019. Taken with the abolition of Class 2 NICs, Treasury say these changes will affect self-employed individuals with profits above £16,250.
- Reduce dividend tax-free allowance from £5,000 to £2,000 from April 2018
On the Economy, Philip Hammond announced:
- The UK was the second fastest growing economy in the G7 during 2016
- Growth forecast for 2017 upgraded from 1.4% to 2%
- However GDP has been downgraded to 1.6%, 1.7%, 1.9% in subsequent years, then 2% in 2021-22
- Annual rate of inflation is forecasted to rise from 2.3% to 2.4% in 2017-18 before falling to 2.3% and 2.0% in subsequent years
- A further 650,000 people expected to be in employment by 2021
The Chancellor also recognised the need to increase the UK’s productivity and skill set and has committed himself to supporting:
- Technical education – £500 Million for the creation of ‘T-levels’, in an effort to bring technical education in line with academic qualifications.
- Return to work support – £5million for ‘returnships’ to get more people back into work after lengthy careers breaks.
- Lifelong learning pilots – £40 million to help retrain and upskill the UK’s workforce, a key commitment in the government’s industrial strategy.
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