Spring Budget 2017 – Initital Key Points
In the ‘last ever Spring Budget’ Chancellor Philip Hammond emphasised the Government’s commitment to business and working families. We have summarised below the key points of the Budget. Our full report and analysis will follow in the next few days.
- Borrowing forecasts down this year and next from £59bn in 2017/18 to £58.3bn and from £46.5bn in 2018/19 to £40.8bn.
- Growth forecast for 2017 up from 1.4% to 2% but down from 1.7% to 1.6% in 2018.
- Reduction in corporation tax confirmed for April 2017 down to 19% with a further reduction down to 17% from April 2020.
- There is to be a consultation on business rates before the next scheduled revaluation. In the meantime 3 measures were announced to provide assistance to smaller businesses:
- Businesses coming out of the smaller rate relief will benefit from an additional cap – rates in the first year will not increase by more than £50 per month
- Local pubs with a rateable value below £100,000 will benefits from a £1,000 discount
- Local Authorities will be granted £300million to provide discretionary relief in cases of hardship.
- The Chancellor continues to focus on collecting taxes that are due and further measures will be introduced to tackle avoidance.
- Class 4 National Insurance Contributions (NICs) for the self employed are to rise from 9% to 10% from April 2018 to coincide with the abolition of Class 2 NICs. Class 4 to rise again in April 2019 to 11%.
- The Dividend Tax Allowance will be reduced from £5,000 per annum to £2,000 per annum from April 2018.
- Increase in ISA allowance to £20,000 from April 2017 is confirmed.
- Personal allowance to increase to £11,500 from April 2017 and higher rate tax threshold to £45,000.
- National living wage to increase to £7.50 in April.
- The new NS&I bond announced in the Autumn will be available from April and will pay 2.2% gross on deposits up to £3,000.
- Free childcare entitlement for working parents with children aged 3 and 4 to increase to 30 hours per week.
- Further investment in innovation, infrastructure and education, including 110 new free schools.
- £2billion to be allocated to social care, with £1billion being made available in 2017/18.
If you would like to discuss how any of the Budget announcements may affect your financial plans, please do contact us.
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