The Chancellor Jeremy Hunt delivered his Spring Budget in the House of Commons under the headings of Employment, Education, Enterprise and Everywhere.
A number of previously announced changes due to take place from April 2023 have been re-confirmed including the tax rates and allowances in relation to income tax, capital gains tax and National Insurance Contributions as announced in the Autumn Statement; together with confirmation of the change in the corporation tax main rate to 25% from April 2023. A range of new tax related measures were also announced by the Chancellor and the key highlights are summarised below:
Capital Expenditure – The Capital Allowances regime is to change from April 2023 when businesses will benefit from the following:
- Full Expensing - 100% first-year relief for companies on qualifying new main rate plant and machinery investment until March 2026
- First Year Allowance - 50% relief for companies on new special rate (including long life) assets until March 2026
- Annual Investment Allowance - 100% relief for plant and machinery investment up to £1m, available to all businesses including unincorporated businesses and most partnerships
R&D Tax Credits – Enhanced R&D relief from April 2023 for loss making R&D intensive SMEs, where a company has an R&D intensity of at least 40%
Pensions - Lifetime allowance charge to be removed and annual allowance to increase from £40k to £60k, from April 2023
Creative Industries – Existing enhanced tax reliefs for Theatres, Orchestras and Museums will continue from April 2023 for two years
Investment Zones – Twelve new proposed investment zones with enhanced tax reliefs to include one in Northern Ireland
Charitable Giving – Restriction on charitable tax reliefs - limited to UK charities and UK Community Amateur Sports Clubs only from April 2023 (transitional relief regarding EU and EEA charities until April 2024)
Inheritance Tax – Woodlands and Agricultural Property IHT reliefs will be restricted to land in the UK for transfers made on or after 6 April 2024
