Philip Hammond’s first Budget as the Chancellor of the Exchequer was a largely quiet affair with few major and out of the blue announcements. Here’s the key changes that could affect you:
- The tax free dividend allowance will reduce from £5,000 to £2,000 from April 2018
- The main rate of Class 4 National Insurance Contributions (NICs) paid by self-employed individuals will increase from 9% to 10% from April 2018 and 11% in April 2019
- From 1st April 2017, the VAT registration threshold will increase to £85,000 from £83,000
- Public sector contractors are now likely to fall under IR35, which requires the deduction of PAYE and NICs
- The disallowance of trading losses when a business reappropriates an asset from capital to stock
- Public houses with a rateable value below £100,000 will get a £1,000 discount on business rates
- Small businesses, sole traders and landlords operating under the VAT threshold will have an extra year to prepare for Making Tax Digital (April 2019). Those with a turnover in excess of the VAT threshold must comply from April 2018. Companies have until 2020 before they need to comply.
To find out more about how Making Tax Digital and the quarterly reporting requirements will affect your business, contact our group tax compliance manager, Paul Brides at firstname.lastname@example.org.