The Autumn Budget 2017 – What we already know and predictionsOn 22nd November, the Chancellor of the Exchequer Philip Hammond, will outline the first full Autumn Budget and the first since June's disastrous snap-election. What does it have in store for taxpayers and contractors alike?
Tax-free Dividend Allowance reduction to £2,000
We already know that the £5,000 dividend allowance was to be reduced to £2,000 from April 2018. The £5,000 allowance and new tax treatment of dividends have only been in place since April 2016.
IR35 Private Sector Changes
There has long been the opinion that HMRC will roll out off-payroll legislation more widely after a brief trial with the public sector, The Government maintain that the implementation of the regulations have gone smoothly but contractors feel anything but. Many recruiters and agencies will be scrambling to react to any changes if they then come in to effect from April 2018.
Tax Rates shouldn’t change but National Insurance could rise
It’s highly unlikely there will change to either dividend or income tax rates. A National Insurance overhaul has been mooted for some time though.
Possible restrictions on Pension Tax Relief
May believe that Mr Hammond a change may be incoming, especially based on the fact that that higher-rate taxpayers account for half of all pension contributions, but nearly three-quarters of all tax relief.
HMRC’s continued push of Making Tax Digital
The Government will continue their alleged simplification of taxes, and we should hear more about the implication of MTD and the moves to quarterly reporting for taxpayers. This has already been delayed several times already.
Tackling Tax Avoidance
More and more unscrupulous Umbrella schemes seem to be popping up, offering offshore loan schemes and other contrived attempts to pay less tax. HMRC may attempt to make wider reaching attacks on these schemes however, we have seen in the past that often genuinely self-employed or flexible workers can get caught in the cross-fire and suffer too.