On the 22nd of November the Chancellor, Philip Hammond, announced a number of measures that affect small business’ and individual’s taxation.
Tax Rates & Allowances
The personal tax allowance was raised from £11,500 to £11,850 while the higher rate tax threshold was increased from £45,000 to £46,350.
From April 2018, the tax-free dividend allowance is reducing from £5,000 to £2,000 meaning it could be beneficial to take dividends from a Limited Company before this date.
Making Tax Digital
The enabling legislation has been passed meaning that VAT registered businesses will be required to use Making Tax Digital from April
2019 National Living Wage
The National Living Wage for those aged 25 and over will increase from £7.50 per hour to £7.83 per hour from April 2018.
Marriage Tax Allowance
The marriage tax allowance can now be claimed by widows or widowers and can be backdated by up to four years.
Rental Property Interest Relief
Relief will be available as follows:
Finance cost allowed in full
Finance cost allowed at basic rate
Year to 5 April 2017
Year to 5 April 2018
Year to 5 April 2019
Year to 5 April 2020
Year to 5 April 2021
Stamp Duty Land Tax
First-time buyers of homes worth between £300,000 and £500,000 will not pay stamp duty on the first £300,000. They will pay the normal rates of stamp duty on the price above that. This will save £1,660 on the average first-time buyer property. 80% of people buying their first home will pay no stamp duty.