Photo by Damir Spanic on Unsplash
The point at which people will pay income tax rises to £11,500 for 2017/18 which is some £500 higher than the current year.
From April 2016, spouses and civil partners may transfer £1,150 of their personal allowance to each other. The point at which people pay higher rate tax has risen and will be £45,000 for 2017/18.
The thresholds at which people pay National Insurance have not risen as significantly so employees can still expect to pay National Insurance even if there is no tax to pay – this will kick in at £157 per week (£8,164 per annum). The Employment allowance continues at £3,000. This excludes single director / employee companies who can't claim it.
Class 2 National Insurance continues to be collected as part of the Self Assessment process and will be abolished from 6th April 2018. National Insurance entitlement will be included in the Class 3 or 4 contributions. The Chancellor made reference to self employed individuals not paying equal taxes and it now would appear highly likely that the rate of Class 4 National Insurance could increase to 12% to align with employees.
There are no changes to the new dividend tax and several references were made to ‘tax driven incorporations’ and ‘disguised employment’ so we can expect to see more HMRC activity in this area.
The point at which people will pay income tax rises to £11,500 for 2017/18 which is some £500 higher than the current year.
From April 2016, spouses and civil partners may transfer £1,150 of their personal allowance to each other. The point at which people pay higher rate tax has risen and will be £45,000 for 2017/18.
The thresholds at which people pay National Insurance have not risen as significantly so employees can still expect to pay National Insurance even if there is no tax to pay – this will kick in at £157 per week (£8,164 per annum). The Employment allowance continues at £3,000. This excludes single director / employee companies who can't claim it.
Class 2 National Insurance continues to be collected as part of the Self Assessment process and will be abolished from 6th April 2018. National Insurance entitlement will be included in the Class 3 or 4 contributions. The Chancellor made reference to self employed individuals not paying equal taxes and it now would appear highly likely that the rate of Class 4 National Insurance could increase to 12% to align with employees.
There are no changes to the new dividend tax and several references were made to ‘tax driven incorporations’ and ‘disguised employment’ so we can expect to see more HMRC activity in this area.
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