Tax Director at Baker Tilly Mooney Moore Neil Armstrong
“Today’s Autumn Statement delivers a range of measures aimed at easing the pressure on personal and business finances, but in reality, represents little in the way of immediate change.”
“Certainly, there are some takeaways for businesses, mainly the decision to convert Full Expensing to a permanent measure. A tax break that was introduced in the Spring Budget to replace the Super Deduction, the Full Expensing Scheme allows companies to deduct spending on investment from profits by a maximum of 25p on every £1, meaning they then pay lower amounts of corporation tax. The conversion of this measure to permanent will extend this relief for businesses, however with the availability on Annual Investment Allowance, it is only generally applicable to the largest companies.”
“On the personal finance side, the 2% reduction in the National Insurance rate on earnings between £12,570 and £50,270 will make employees slightly better off at the end of each month. Once implemented in January, it will allow a maximum saving of £754 per annum for employees, while for sole traders and partnerships the abolishment of Class 2 NICs and decrease in Class 4 NICs will save a maximum of £569 per annum. These measures are a step in the right direction, but they represent only minor progress towards easing the financial pressures individuals are facing. With the National Minimum Wage increased by 9.8%, the Chancellor has presented a combination of measures that on the surface appear significant, but in reality, include little additional relief and may in fact leave some small and medium sized businesses worse off.”