[UK] Breaking down the chancellor’s autumn statement

The UK chancellor Jeremy Hunt delivered his autumn statement to the House of Commons today. He announced that the government will deliver a plan to tackle the cost of living crisis and rebuild the UK economy and defined his priorities as stability, growth and public services.

Mr Hunt stated that the economy is already in recession, with higher energy prices explaining the majority of the revision in growth forecasts.

The major announcement for tax was the reduction of the additional rate earnings threshold. It will be reduced from £150,000 to £125,140 from April 6, 2023, as rumours prior to the statement had suggested.

All other thresholds and rates will be frozen until 2028, two further years more than previous plans. This is in addition to the indefinite delay to the basic rate of tax reduction, scrapped as part of the growth plan roll back.

Here is a breakdown of key points from the fiscal update affecting payroll:

• National Living Wage will increase to £10.42 at the LPC’s recommendation 
• Benefits will be uprated by the inflation rate (10.1 per cent)
• State pension triple lock will be protected and increase with inflation (10.1 per cent)
• National Insurance and inheritance tax threshold freeze extended to April 2028
• Dividend allowance will be cut from £2,000 to £1,000 next year and to £500 from April 2024
• Transition from employment and support allowance onto universal credit delayed until 2028
• Government review on pension age to be published in early 2023

• Income tax personal allowance threshold frozen until 2028
• Employment allowance will remain at £5,000
• Additional rate of tax threshold will reduce to £125,140
• Company car tax rates for electric vehicles will annually rise by a maximum of 1 per cent for 3 years from 2025
• Tariffs will be cut to support business supply chains
• The OBR forecasts that inflation will fall to 7.4 per cent next year

For further information on how these changes will impact employers, click here to read Lee McIntyre-Hamilton's autumn statement analysis.

On November 21 you can join Lee for his post-budget LinkedIn Live. Book your place here.

The UK chancellor Jeremy Hunt delivered his autumn statement to the House of Commons today. He announced that the government will deliver a plan to tackle the cost of living crisis and rebuild the UK economy and defined his priorities as stability, growth and public services.

Mr Hunt stated that the economy is already in recession, with higher energy prices explaining the majority of the revision in growth forecasts.

The major announcement for tax was the reduction of the additional rate earnings threshold. It will be reduced from £150,000 to £125,140 from April 6, 2023, as rumours prior to the statement had suggested.

All other thresholds and rates will be frozen until 2028, two further years more than previous plans. This is in addition to the indefinite delay to the basic rate of tax reduction, scrapped as part of the growth plan roll back.

Here is a breakdown of key points from the fiscal update affecting payroll:

• National Living Wage will increase to £10.42 at the LPC’s recommendation 
• Benefits will be uprated by the inflation rate (10.1 per cent)
• State pension triple lock will be protected and increase with inflation (10.1 per cent)
• National Insurance and inheritance tax threshold freeze extended to April 2028
• Dividend allowance will be cut from £2,000 to £1,000 next year and to £500 from April 2024
• Transition from employment and support allowance onto universal credit delayed until 2028
• Government review on pension age to be published in early 2023

• Income tax personal allowance threshold frozen until 2028
• Employment allowance will remain at £5,000
• Additional rate of tax threshold will reduce to £125,140
• Company car tax rates for electric vehicles will annually rise by a maximum of 1 per cent for 3 years from 2025
• Tariffs will be cut to support business supply chains
• The OBR forecasts that inflation will fall to 7.4 per cent next year

For further information on how these changes will impact employers, click here to read Lee McIntyre-Hamilton's autumn statement analysis.

On November 21 you can join Lee for his post-budget LinkedIn Live. Book your place here.