The Chancellors Spring Statement has just been broadcast live to the nation here on 23rd March 2022, during which Chancellor Rishi Sunak has unveiled his plans to the House of Commons. The Chancellor has been under increasing pressure to act, with prices rising the fastest in 30 years.
Our Certified Accountants were listening and are ready to help advise on the points coming from the statement. So, how will these new changes effect you and your business? Let’s take a look at the main points…
Spring Statement Taxation Changes
National insurance threshold raised by £3,000 ahead of 1.25 percentage point rise, this increases the allowance from £9,500 to £12,500
People can earn £12,500 without paying income tax or national insurance from July
Employment allowance for businesses will increase to £5,000 from next month
By 2024 basic rate of income tax to be cut from 20% to 19%.
What could this mean for your business?
Without planning will these new tax rules increase your liability to tax, answer these few questions below to find out how you will be effected.
Spring Statement Household Costs
The cost of living has been rising quickly and the Chancellor has been forced to act to help the country afford to live though these drastic price rises. As previously announced, there will be a 54% rise in energy cap will come into effect from April 2022 with average bills up by £693. This will effect households all over the country, some more than others with many struggling to keep up with growing costs.
This morning before the Chancellors Spring Statement social media was abuzz with conversation and pleas to the Chancellor to make the much-needed changes to get us all through this tough time. Martin Lewis (The Money Saving Expert) also posted his wishes direct to Rishi Sunak on Facebook, saying “Dear Rishi Sunak, the UK is standing on the brink of a personal finance precipice. Today you, only you, have the tools to pull it back. To save lives. To improve living standards. To reduce the anxiety of millions.”
What could the Chancellors 2022 Spring Statement mean for you and your business?
The Chancellor has responded with the following changes:
£350 supports for households via loans and grants which has already been announced
National living wage is rising from £8.91 to £9.50 hour as announced in the autumn budget
Fuel duty to be cut by 5 pence per litre as average petrol prices hit all time high, this will last until March 2023
VAT Scrapped on energy saving materials such as solar panels, savings can be up to £1000 if solar panels are installed
Bank of England has raised interest rates to 0.75% back to pre-pandemic level
The household support fund will be doubled to £1bn from April this year
OBR Forecast economy to grow by 3.8% this year revised down from 6% and the OBR data estimates that inflation is to rise even further averaging 7.4% this year.
Is this enough?
After his statement Labour were given their chance to respond. The House of Commons was filled with calls of “Is this enough?” and “It’s not enough”, with fears that many proposals put forwards to help the British public had not been picked up by the Chancellor.
What do you think? Are these changes enough to help you and the average UK household? Let us know in the comments below!
We are here to help
If you are worried about any of the changes mentioned in today’s Spring Statement please feel free to get in touch and one of our Accountants would be happy to look at your circumstances and ensure you are not going to have any additional liabilities arise from these changes.