24 Mar 2022 Spring Budget Announced
Yesterday, Rishi Sunak, the Chancellor of the Exchequer, announced a new tax plan which includes a National Insurance threshold rise, increases in Employment Allowance and cuts to personal taxes. The key changes affecting businesses have been summarised below.
There will be an increase to the National Insurance income threshold, which will rise to £12,570 from July 2022. The Treasury said this tax cut will save the typical employee over £330 a year.
In a bid to boost investment, innovation and growth, Employment Allowances will increase by £1,000. Employment Allowance is a relief which allows smaller businesses to reduce their employers National Insurance contributions bill each year. This increase means that the allowance will rise from £4,000 to £5,000, from the 6th April.
From April, business rates relief of 50% will be available for eligible retail, hospitality and leisure properties. The discount will be capped at £110,000 per business.
The basic rate of income tax in England will also be cut for the first time in 16 years, with a reduction from 20% to 19% by the end of 2024. Note that this change does not affect Scotland, where income tax rates are devolved.