The autumn budget 2017 is the first of the new annual budgets, now the spring version has been deemed as not necessary.  Nonetheless there was little of note and there were few surprises and much had already been released.  The headline if any stemmed from maintaining fiscal responsibility while helping families cope with the cost of living.  Philip Hammond started with the usual report on the economy and picking the favourable statistics from the Office for Budgetary Responsibility (OBR):

  • Another 600,000 predicted to be in work by 2022
  • 3 million new jobs since 2010
  • Less favourably, growth figures gloomy
  • The Treasury summary follows:

For business

  • Despite calls to reduce the threshold for VAT registration in line with other countries, this is being resisted and the current £85k threshold is being held for the next 2 years
  • Support for new tech business start ups with government investment in 5G, Artificial Intelligence and Fibre networks
  • Main R&D tax credit increased to 12%, useful for innovative businesses
  • Indexation allowance on capital gains for business to be frozen after January 2018
  • Various business rates changes including changing indexing increases from RPI to CPI inflation and continued rate relief for small pubs

Cars and excise duties

  • Fuel duty to be frozen again
  • Increased in duty in cheap high strength alcohols (known as white cider) from 2019, but other alcohol duties to be frozen
  • Diesel cars are in the spotlight with increased road tax and benefit charges until manufacturers improve their emissions – no changes for “white van man” though
  • Charging of electric cars at work will be free of benefits in kind (no doubt until everyone is doing so when the government will change it’s mind)
  • Government support for driverless cars (apparently not just because they are hated by Jeremy Clarkson!)

Families and housing

  • Increases in the personal tax allowance to £11,850 and the higher rate threshold to £46,350 (as expected)
  • Universal credit entitlement to start on the day of claim and a full month’s payment to be available within 5 days
  • 4.4% increase in the National Living Wage (NLW) from £7.50 to £7.83
  • Further investment in maths and computers in schools and upskilling workers in the workplace too
  • Council allowed to impose a 100% premium on council tax on empty properties
  • Due to fall from 59% to 38% in under 35s owning homes, over the next 4 years £44bn to be invested in various schemes to encourage building, hopefully upto 300,000 new homes pa by mid 2020s
  • Stamp duty for 1st time buyers abolished for homes worth upto £300k and with a £300k tax free band on homes upto £500k in expensive areas such as London

Other headlines

  • The government is to look into taxing single use plastics to help the environment
  • Tolls to cease on the Severn Bridge (but no changes on the Dartford Crossing)
  • Rolling stock on the Tyne & Wear Metro to be replaced
  • Additional £2.8bn to be made available over the next 3 years, in addition to funds already allocated
  • Multinational digital businesses paying royalties to low tax jurisdictions will pay income tax on those royalties on UK earnings
  • Online VAT fraud – both the seller and the online marketplace (eg Amazon/Ebay) to be jointly liable for the VAT of the seller

Good news

  • Despite high expectation of changes in IR35 rules for contractors nothing was announced in the Budget
  • No changes to the announced tax free bands for dividends (£2k from April 2018), or dividend tax rates
  • No changes for the self employed with merger of tax and NIC

So while there was little new or news in the autumn budget 2017, the good news is that small businesses which make up such an active part of the economy have not been hard hit.  As with all Statements and Budgets there will be more issued in Press releases but once again outside of the usual political gesturing, very little news.  You should seek professional advice before taking any steps based on these contents. If you would like advice in this or other areas feel free to call. Alastair Wood, AW Accounting, Gravesend, Kent – Accountants who “speak your language”