After two full Budgets in 2017, this Spring Statement was a less dramatic affair, with no announcements of tax changes. These will come in the Autumn Budget.
The Chancellor launched a number of consultations and other papers about future proposals. The subjects ranged from ways to squeeze more tax from international digital businesses to a proposal for extending entrepreneurs’ relief to some shareholders whose holdings drop below the qualifying 5% level. He has also been mulling the possibility of lowering the VAT threshold.
Our summary includes a useful recap of the key changes for the forthcoming 2018/19 tax year that have already been announced and passed into law.
April will see the usual changes to the income tax rates and allowances as well as national insurance contributions. This year there will also be a cut in the dividend allowance and some special new tax rates for Scottish taxpayers. The tax increases on company cars may look relatively modest, but their cumulative impact could be significant for some people.
Many employees will see the extra net income from the tax changes eaten up by their higher minimum auto-enrolment pension contributions. The lifetime allowance for pensions has been raised. Less welcome for some will be the changes to employee termination payments and the new rules for enterprise investment schemes.