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Budget Summary Report November 2017

Chancellor Philip Hammond took to the floor to outline his Autumn Budget and plans for the future of Britain.

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How will the Budget affect you?

Chancellor Philip Hammond took to the floor to outline his Autumn Budget and plans for the future of Britain. Saying that ‘we’re at a turning point in our history’ and promising to use his Budget to ‘look forward, embrace change and meet our challenges head on’, here’s our run down of the key announcements that are likely to affect you:

Objectives

The Chancellor set out the government’s intended actions to:

  • Support more affordable housebuilding for those who aspire to own their own home
  • Prepare for our exit from the EU
  • Become a leader in new technologies such as Artificial Intelligence, immersive, driverless cars, life sciences and Fin-tech
  • Provide the skills opportunities to succeed in the modern economy
  • Increase investment into the NHS to improve infrastructure
  • Provide short-term support for households.

Economy

  • OBR revised down its growth forecasts for GDP to 1.5% for 2017, slowing during 2018 and 2019 but recovering and rising in 2022 to 1.6%
  • In preparation for the UK’s exit from the EU, an extra £3bn is to be made available primarily to assist the funding of border controls, future immigration systems and new trade relationships.

Freelance Contractors

  • Off-payroll working in the private sector (“IR35”) – it is possible that the off-payroll working rules introduced in the public sector rules in April 2017 may be extended to the private sector. The Government will consult on how to tackle non-compliance in the private sector and external research already commissioned by the Government is due to be published in 2018.
  • VAT threshold of £85,000 to remain unaltered for the next two years

Personal taxation

  • The Personal Allowance will rise from £11,500 to £11,850 from April 2018. The Higher Rate Threshold will increase from £45,001 to £46,350. The Government is committed to raising the Personal Allowance to £12,500 and £50,000 by 2020.
  • From 6 April 2018, the vehicle excise duty (VED) supplement for diesel company cars will increase from 3% to 4%
  • The lifetime allowance for pension savings will increase with the consumer price index to £1,030,000 by 2018/19.

Public services

  • £6.3bn is to be invested into the NHS to improve waiting times for patients, A&E performance, building infrastructure and care
  • National Living Wage and National Minimum Wage will increase from April 2018 to £7.83 per hour.
  • Suggested investment of some £160m to improve the teaching of Maths and Sciences in schools
  • National Productivity Investment Fund to be extended by a further £31bn
  • £1.7bn for the Transforming Cities Fund for local transport investment in the Northern Powerhouse regions
  • £400m boost to the infrastructure for charging electric cars.

Business

  • Indexation allowance on corporate capital gains will be frozen from 1 January 2018
  • Tightened rules around the online marketplace, placing responsibilities on the seller and the hosting site to ensure VAT numbers are placed correctly
  • Increased vehicle excise duty from April 2018 in line with RPI
  • An increase to air passenger duty on long haul flights and premium seating but a freeze on short haul duty.

Housebuilding

  • Further £15bn financial support for housebuilding over the next five years
  • Target to build 300,000 new houses per annum from 2020
  • Encourage the better use of building in cities and towns, urban areas and protecting green belt
  • Focus on ‘Garden Towns’ with the intention to build five new developments
  • Stamp Duty Land Tax has been abolished for first time buyers purchasing property up to £300k. Any properties up to £500k are exempt for the first £300k and then standard rates thereafter
  • Reform of planning system to boost the availability of the right land for development including first time buyer developments and increasing housing density in urban areas.

For full details of how the Budget will affect you, download a copy of our Budget Summary report.

Budget Summary