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September 2022 Mini-Budget followed by reversals

September 2022 Mini-Budget followed by reversals

The announcement of a range of tax cuts by Kwasi Kwarteng in the mini-Budget on 23 September has been mostly reversed by his successor, Jeremy Hunt.

This table summarises the current tax proposals alongside the previously announced changes, highlighting which cuts are scrapped and which are confirmed:

Current Proposal Previously Announced
Stamp Duty Land Tax (SDLT) Previously announced changes are confirmed

Nil rate band increased to £250,000

First time buyers:

  • Nil rate band increased to £425,000
  • Can claim relief on properties up to £625,000
Corporation tax

The previously announced scrapping of the corporation tax rate increase from April 2023 will not be implemented. Corporation tax will therefore increase to 25% from April 2023 for companies with profits above £250,000 per year.

Companies with profits up to £50,000 - 19%

There will be a sliding scale for companies with profits from £50,000 to £250,000

Corporation tax will remain at 19% and will not increase to 25% in 2023.

Diverted profits tax (applicable only to multinational companies) will remain at 25% in 2023.

Capital allowances The previously announced changes are confirmed

Annual investment allowance (AIA) remains at £1 million in 2023 and will not decrease to £200,000 as previously announced.

130% super deduction will end in April 2023 as announced previously.

Investment schemes The previously announced changes are confirmed

Seed Enterprise Investment Scheme (SEISS) changes from April 2023:

  • Increased to £250,000 (from £150,000)
  • Gross assets limit increased to £350,000 (from £200,000)
  • Company max age increased to 3 years (from 2 years)

Company Share Option Plan (CSOP) – upper limit increase to £60,000 (from £30,000) in April 2023

Off Payroll Working The previously announced retraction of 2021 rules will not be implemented and the rules will remain as they are currently.

New rules introduced in 2021 were reversed.

IR35 remains as introduced in 2000

Alcohol Duty The previously announced alcohol duty cuts will not be introduced.

Small Brewers Relief will be reformed into Small Producer Relief, extending it to small producers of wines, spirits, ciders and lower strength beers.

Personal Income Tax

The previously announced cuts to the basic rate of tax and scrapping of the additional rate of tax will not proceed. Personal tax rates will remain as they are currently.

Basic rate remains 20%

Additional rate remains 45%

Changes from April 2023:
  • Basic rate of income tax reduced to 19% (from 20%)
  • 45% additional rate of tax scrapped
National insurance The cut in NI contributions by 1.25% from November 2022 is confirmed

NI contributions cut by 1.25% from November 2022

Dividends tax

The 1.25% cut in dividends tax has been scrapped.

The dividends tax rates will remain as follows:

  • Basic rate: 8.75%
  • Higher rate: 33.75%
  • Additional rate: 39.35%

Dividends tax will be reduced by 1.25% from April 2023 as follows:

  • Basic rate: 7.5% (from 8.75%)
  • Higher rate: 32.5% (from 33.75%)
Insurers: Everest Insurance (Ireland) DAC, incorporated in Ireland and Ascot Syndicate 1414 at Lloyd’s incorporated in the United Kingdom. Certificate Number: BP07416-2201
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