Written by Ray Coman   Jeremy Hunt has been brought into his role during a cost-of-living, war in Ukraine, high inflation and soaring energy prices.  The Autumn statement 2022 which was delivered about 11:30 today outlined the government’s plan to cut spending and increase taxes.   Additional rate tax Freezing of allowances Cut on capital allowance threshold Dividend allowance to be dropped Freeze to employer NIC threshold Cut to research and development tax relief Stamp duty sunset Business rates Vehicle exercise duty exemption to end Windfall taxes Public spending Summa ..read more

  Written by Ray Coman   The government has succumb to external pressure to reverse two of its main tax cuts.  The rate of corporation tax will not be cut as previously announced.  The top rate of income tax will not reduce in April 2023, but remain at 45%.   Truss was keen mark her new premiership with a strong change of direction on fiscal policy.  The Growth Plan 2022 would be driven by reducing tax.  Shortly after taking office, Liz Truss and the then Chancellor kwasi kwarteng set out the dramatic tax cuts on 23 September 2022.&nb ..read more

  Written by Ray Coman   Only three weeks into his appointment, and Kwasi Kwarteng has unleased a major tax reform. While far reaching, the government stopped short of labelling the announcements as a Budget and therefore avoided the associated forecasting requirement from the Office for Budget Responsibility.  Consequently, the Treasury has not had to justify how the planned tax cuts will be costed.   Despite the lack of explanation, it is evident that the tax cuts will be funded through the issuance of government debt.  The markets have reacted strongly and the pound ..read more

  Written by Ray Coman   Since the increase in the employee's national insurance limit announced in the Spring Statement a new opportunity exists for contractors to save tax through a higher salary payment.  Since this salary payment will give rise to national insurance it is recommended that the £2,808 differential is paid as a bonus in March 2023.  This minimises the number of payments to be made to HMRC and postpones payments as far as possible.  The tax saving of £387 is illustrated in the table below:    Salary to employer's threshold Salary ..read more

  Written by Ray Coman   This year’s Spring statement was delivered in the context of the unprovoked attack on the Ukraine by Russia, related energy price increases and ongoing inflation headwinds. To tackle the resultant rise in cost of living, the Chancellor announced a decrease in fuel duty and a hike in national insurance thresholds.   Rise in National Insurance limit Income tax rate cut Fuel duty eased Employment allowance to increase VAT savings on energy saving materials Business rate relief to be extended Annual Investment allowance to increase five-fold Help to Grow &nb ..read more

  Written by Ray Coman   Light on change but only about 7 weeks after announcement of the Health and social care levy, the Budget acted mainly as recap on regulation scheduled for the Finance Bill 2021/22.  Rishi Sunnak’s third Budget made further pledges to increase spending on the NHS.   Increase in rate on dividend tax Advancement in retirement age Annual Investment Allowance up Residential Property Developer Tax  Capital Gains tax reporting time limits to be extended Promoters of Tax Avoidance to be more heavily punished Benefit-in-kind taxation to increase for veh ..read more

  Written by Ray Coman   A hike in national insurance, dubbed the ‘social care levy’, will be phased in by the government from next April.  The government will increase national insurance of 1.25%.  Currently, national insurance is not payable by individuals of who have reached the state retirement age, which is currently 66 for most people.  However, from April 2023, the levy will be payable by all adults.   Employment national insurance levy Self-employed national insurance levy Contractor company national insurance levy Applications   Employment national i ..read more

  Written by Ray Coman   In his opening remarks, Mr Sunak put into numbers the sheer cost of supporting the economy through the pandemic.  He explained that borrowing had been at its highest since World War 2. This places the UK in a predicament because a mere 1% increase in interest rates would add £25 billion to the cost of debt.  Fiscal measures aim to stimulate the economy through its recovery phase and afterward buffer finances to shore up British debt.   Among rumours and fears of shock tax rises especially to capital gains tax, the 2021 Budget has been one of th ..read more

  Written by Ray Coman   In March 2020, the government announced a series of tax and cash saving measures in an attempt to soften the economic blow of covid.  This included a provision that payment of VAT usually due between 20 March 2020 and 30 June 2020 could be deferred until 31 December.  The deadline was subsequently extended to 31 March 2021.   Recap on opt deferral procedure   Many traders chose to pay VAT by direct debit, for its convenience and the comfort of knowing that a VAT payment will not be late.  A Vat deferral did not need to be applied for ..read more

  Written by Ray Coman   Coman & Co has published an e-pamphlet which is available through various outlets, but can be downloaded here: Tax_after_Coronavirus.pdf ..read more