The Chancellor, Jeremy Hunt, presented his Autumn Statement 2023 speech on Wednesday 22 November. This is our 'At a glance' summary of the key tax announcements and measures.
Index to sections
- Capital allowances
- National Insurance Contributions (NICs)
- Employers and employment taxes
- Income Tax
- Corporation Tax
- Large corporates
- Pensions
- Stamp Taxes
- VAT
- Tax administration
- Other announcements
Full expensing
- Full expensing and the associated 50% First Year Allowance will be made permanent by Autumn Finance Bill 2023, instead of ending on 31 March 2026 as originally intended.
- The government will consider whether there is a case to extend full expensing to leasing. A technical consultation will be issued in due course.
Capital allowances: technical consultation
- From January 2024, HMRC will launch a consultation looking at wider changes that can be made to capital allowances as a whole.
- Views will be sought as to how to simplify or reduce the existing legislation. The consultation will not review the scope of expenditure covered by current capital allowances.
Tonnage Tax: extension to ship management and capital allowance leasing limits
From 1 April 2024:
- As announced at Spring Budget 2023, legislation in Autumn Finance Bill 2023 will permit third-party ship management companies to join the Tonnage Tax regime.
- Legislation will be brought forward to raise the limit on capital allowances to £200 million for lessors of ships into the regime.
See Autumn Statement 2023: Capital Allowances
National Insurance Contributions (NICs)
Class 1 (employee NICs)
From 6 January 2024:
- The main rate of employee Class 1 NICs will be reduced by 2%, from 12% to 10%.
From 6 April 2024:
- The Lower Earnings Limit will remain at 2023-24 levels for 2024-25 (£6,396).
Class 2 (self-employed NICs)
From 6 April 2024:
- Class 2 NICs will be abolished. Self-employed individuals:
- With profits above £12,570 will no longer be required to pay Class 2 NICs, but will continue to receive access to contributory benefits including the state pension.
- With profits between £6,725 and £12,570 will continue to receive access to contributory benefits, including the state pension, by way of an NI credit.
- With profits below £6,725 who choose to make voluntary Class 2 contributions to secure access to contributory benefits can continue to do so.
- The Class 2 voluntary contributions rate will be frozen at its 2023-24 rate of £3.45 per week for 2024-25.
- The Small Profits Threshold will also be frozen at £6,725.
Class 3 (voluntary NICs)
From 6 April 2024:
- The Class 3 rate will remain at £17.45 per week for 2024-25.
Class 4 (self-employed NICs)
From 6 April 2024:
- Main rate Class 4 NICs will reduce by 1%, from 9%, to 8%.
Extension of NICs relief for hiring veterans
- The employer's NI relief for hiring qualifying veterans is to be extended by one year to April 2025.
See Autumn Statement 2023: National Insurance
Employers and employment taxes
Fuel benefit charges and the van benefit charge
From 6 April 2024:
- The van benefit charge and the car and van fuel benefit charges will be maintained at 2023-24 levels for 2024-25.
- The van benefit charge will remain at £3,960.
- The van fuel benefit charge will remain at £757.
- The car fuel benefit multiplier will remain at £27,800.
Enterprise Management Incentives (EMI): extending the time limit to submit a notification of a grant of options
For EMI options granted on or after 6 April 2024:
- As announced at Spring Budget 2023, legislation in Autumn Finance Bill 2023 will extend the time limit to notify HMRC of a grant of EMI options from 92 days following the grant to 6 July following the end of the tax year in which the grant was made.
National Living Wage (NLW) and National Minimum Wage (NMW)
From April 2024:
- The NLW will increase to £11.44 per hour and be extended to include those aged 21.
- The NMW for those aged 18-20 will increase to £8.60 per hour.
- The apprentice rate increases to £6.40 per hour.
Calculation of PAYE liability in cases of non-compliance with Off-Payroll Working
From 6 April 2024:
- For Off-Payroll Working engagements, HMRC will be able to reduce the PAYE liability of a deemed employer, where that engagement has been incorrectly treated as self-employed for tax purposes, to take account of tax and National Insurance Contributions already paid by the worker and their intermediary on the payments received.
Construction Industry Scheme (CIS) reform: reforms to the Gross Payment Status test
From 6 April 2024:
- Legislation in the Autumn Finance Bill 2023 will add compliance with VAT obligations to the CIS Gross Payment Status compliance test.
- The changes will also expand HMRC’s powers to remove Gross Payment Status immediately in cases of serious non-compliance involving VAT, Income Tax Self-Assessment, Corporation Tax Self-Assessment and PAYE.
- Regulations will be laid to set out exceptions to VAT compliance obligations and to remove the majority of payments made by landlords to tenants from the scope of the Scheme.
See Autumn Statement 2023: Employment taxes
Expanding the cash basis
From 6 April 2024
- Legislation will be introduced by Autumn Finance Bill 2023 to set the cash basis as the default method for calculating trading profits for the self-employed and partnerships.
- The turnover, interest, and loss relief restrictions that currently apply will be removed.
- Businesses not wishing to calculate their profits using the cash basis will need to make an election to use the accruals basis.
- The measure will not affect companies, property businesses, or businesses that are otherwise excluded from using the cash basis, such as mixed partnerships, Limited Liability Partnerships, or businesses claiming farmers’ or artists’ averaging relief.
Simplifying Making Tax Digital (MTD) for Income Tax Self Assessment (ITSA)
- The government plans to make design changes to MTD for ITSA by:
- Simplifying the requirements for all taxpayers in providing quarterly updates and for taxpayers with more complex affairs, such as landlords with jointly-owned property.
- Removing the requirement to provide an End of Period Statement.
- Draft regulations will be published for technical consultation later in 2023 with a large-scale public beta testing programme commencing in 2025.
- It has been confirmed that MTD for ITSA will not be extended to businesses with income below £30,000 for the foreseeable future though this will remain under review.
MTD: volunteers and penalties
From 6 April 2024:
- Legislation in Autumn Finance Bill 2023 will ensure that taxpayers who volunteer to join MTD from April 2024 are subject to the government’s new penalty regime for late filing of tax returns and late payment of tax.
- These changes will apply new penalties to annual obligations only.
ISA savings
From 6 April 2024:
- The ISA annual subscription limits remain unchanged from 2023-24:
- General limit: £20,000.
- Child Trust Funds: £9,000.
- Junior ISAs: £9,000.
- Lifetime ISAs: £4,000.
- Changes will be made to ISAs to simplify the ISA scheme and widen the scope of investments that can be included.
Training costs for the self-employed
- HMRC will clarify guidance on what training costs can be deductible for tax purposes.
- This will ensure that businesses can be confident that updating existing skills or maintaining pace with technological advances or changes in industry practices, are allowable costs when calculating the taxable profits.
Post Office Limited compensation schemes
- Legislation will be introduced to exempt top-up payments made under the Suspension Remuneration Review (SRR) scheme and payments yet to be made under both SRR and the Post Office Process Review Scheme from Income Tax, National Insurance Contributions and Capital Gains Tax.
Enterprise Investment Scheme (EIS) and Venture Capital Trust (VCT) extension
- Legislation will be introduced in the Autumn Finance Bill 2023 to extend the existing sunset clauses for the EIS and VCT scheme from 6 April 2025 to 6 April 2035.
- This will continue the availability of Income Tax and Capital Gains Tax reliefs for investors in new shares issued before 6 April 2035 by EIS-qualifying companies and VCTs.
Blind Person’s Allowance and Married Couple’s Allowance
From 6 April 2024:
- The Blind Person’s Allowance (BPA) and Married Couple’s Allowance (MCA) will be increased by the September CPI figure of 6.7% for 2024-25.
- The BPA will be valued at £3,070 and the MCA will be valued at between £4,280 and £11,080.
See Autumn Statement 2023: Income Tax
Support for visual effects
- A call for evidence on recent trends in the visual effects industry has been published, running until 3 January 2024.
- A subsequent consultation on the design of additional tax relief for visual effects expenditure will follow. It is intended that relief will be implemented from April 2025.
Reform of audio-visual creative tax reliefs
From 1 January 2024:
- As announced at Spring Budget 2023, legislation in Autumn Finance Bill 2023 will reform the film, TV and video games tax reliefs to refundable expenditure credits:
- An Audio-Visual Expenditure Credit (AVEC) for film and TV programmes.
- A Video Games Expenditure Credit (VGEC) for video games.
- Animated film and TV and children’s TV programmes will be eligible for a rate of 39% and for film, high-end TV and video games the rate will be 34%.
EIS and VCT extension
- Legislation will be introduced in the Autumn Finance Bill 2023 to extend the existing sunset clauses for the EIS and VCT scheme from 6 April 2025 to 6 April 2035.
R&D: merger of current Small or Medium Enterprise (SME) and R&D Expenditure Credit (RDEC) schemes
For accounting periods beginning on or after 1 April 2024:
- Legislation in Autumn Finance Bill 2023 will merge the current RDEC and R&D SME schemes for accounting periods beginning on or after 1 April 2024, with a rate of 20%.
- The notional tax rate applied to loss-makers in the merged scheme will be the small profit rate of 19%, rather than the 25% main rate currently set in the RDEC.
R&D: enhanced support for R&D-intensive SMEs
For expenditure incurred from 1 April 2023:
- As announced at Spring Budget 2023, legislation in Autumn Finance Bill 2023 will implement enhanced support for R&D-intensive SMEs.
- Loss-making companies meeting the definition for R&D intensity and claiming the existing SME tax relief will be eligible for a higher payable credit rate of 14.5%.
From 1 April 2024:
- The intensity threshold required to qualify will be reduced from 40% to 30%.
- A one-year grace period will be introduced allowing companies dipping under the 30% threshold to continue to qualify.
R&D: restricting nominations and assignments
From 22 November 2023 and 1 April 2024:
- Legislation in Autumn Finance Bill 2023 will remove the use of nominated payees for R&D tax credit payments, subject to limited exceptions, for all claims made on or after 1 April 2024.
- Legislation will also prevent any new assignment (whether equitable or statutory) of R&D tax credits in relation to assignments made on or after 22 November 2023.
Post Office compensation schemes: corporate entities
Retrospectively:
- Legislation in Autumn Finance Bill 2023 will ensure that companies receiving compensation from the Post Office schemes will be taxed in a similar way to individual recipients.
- Any top-up payment received to account for a tax liability will not be subject to tax at either the corporate or individual level.
- The changes will be retrospective to the date the compensation payments were received.
Administrative changes to the creative industry tax reliefs
- As announced at Spring Budget 2023, legislation in Autumn Finance Bill 2023 will make minor administrative changes to the creative industry tax reliefs.
- This includes rules for connected party transactions and for additional information to be shared with HMRC by companies when they claim relief.
- Technical clarifications to the cultural tax reliefs for theatre, orchestras and museums and galleries will also be legislated.
Annual Tax on Enveloped Dwellings (ATED)
From 1 April 2024:
- ATED annual charges will rise by 6.7% from 1 April 2024 in line with the September 2023 Consumer Price Index. Charges based on property value:
- £500k-£1m: £4,400
- £1m-£2m: £9,000
- £2m-£5m: £30,550
- £5m-£10m: £71,500
- £10m-£20m: £143,550
- £20m+: £287,500
Real Estate Investment Trusts (REITs)
From the date of Royal Assent to Autumn Finance Bill 2023:
- Autumn Finance Bill 2023 will make amendments to the rules for REITs to enhance the competitiveness of the regime.
See Autumn Statement 2023: Corporation Tax
Pillar 2: multinational top-up tax and domestic top-up tax amendments
For accounting periods beginning on or after 31 December 2023:
- Legislation will be introduced in Autumn Finance Bill 2023 to amend the Multinational Top-up Tax and Domestic Top-up Tax which were introduced in Spring Finance Bill 2023.
- The amendments reflect the recent OECD commentary and guidance issued in relation to the practical workings of the Under Taxed Profits Rule (UTPR) and clarify areas identified from stakeholder consultation.
Repeal of Offshore Receipts in respect of Intangible Property (ORIP)
For income arising from 31 December 2024:
- Legislation will repeal the Offshore Receipts in respect of Intangible Property rules.
Electricity Generator Levy: new investment exemption
From 22 November 2023:
- An exemption from the Electricity Generator Levy for receipts from new electricity generating stations will be introduced.
- This measure will take effect for revenues from new electricity generating stations where the substantive decision to invest is taken on or after 22 November 2023.
See Autumn Statement 2023: Large corporates
Abolition of Pensions Lifetime Allowance
From 6 April 2024:
- As announced at Spring Budget 2023, Autumn Finance Bill 2023 will remove the Lifetime Allowance.
Taxation of the pension remedies for Members of Parliament, Members of Senedd and Members of the Legislative Assembly
From Royal Assent of the Autumn Finance Bill 2023:
- Legislation and supporting regulations will ensure the pensions tax framework applies as intended to redress payments from the Parliamentary Contributory Pension Fund, the Senedd Pension Scheme and the Assembly Members’ Pension.
Pension schemes Relief at Source (RAS)
- The digitisation of RAS will not be operative until April 2027 at the earliest.
Surplus extraction arrangements for defined benefit pension scheme
From 6 April 2024:
- Secondary legislation to reduce the free-standing tax charge which applies to authorised surplus payments to sponsoring employers of a registered pension scheme from 35% to 25% will be introduced.
Tackling the problem of small pot pensions
- The government is launching a call for evidence on a lifetime provider model that would allow individuals to have contributions paid into their existing pension scheme when they change employer, providing greater control over their pension.
See Autumn Statement 2023: Pensions
Stamp Duty and Stamp Duty Reserve Tax: widening access to the Growth Market Exemption
From 1 January 2024:
- Legislation in Autumn Finance Bill 2023 will extend the Growth Market Exemption, a relief from Stamp Duty and Stamp Duty Reserve Tax, to include smaller, innovative growth markets.
Stamp Duty and Stamp Duty Reserve Tax: removal of the 1.5% charge on issues and certain related transfers
From 1 January 2024:
- Legislation in Autumn Finance Bill 2023 will ensure that the existing 0% charges under Stamp Duty and Stamp Duty Reserve Tax on issues (and certain related transfers) of securities onto foreign markets, will remain in place and be brought permanently into UK law following the changes in the Retained EU Law (Revocation and Reform) Act 2023 taking effect.
- The legislation will also preserve the 0% charge on issues of bearer instruments.
See Autumn Statement 2023: Stamp Taxes
Women’s sanitary products
From 1 January 2024:
- Legislation will be introduced to extend the scope of the current VAT zero rate relief on women’s sanitary products to include reusable period underwear.
VAT energy-saving materials relief
From February 2024:
- Legislation will be introduced to expand the VAT relief available on the installation of energy-saving materials by extending the relief to additional technologies, such as water-source heat pumps, and to bring buildings used solely for a relevant charitable purpose within scope.
Interpretation of VAT and excise law
- Legislation in Autumn Finance Bill 2023 will clarify how VAT and excise law should be interpreted in light of changes made by the Retained EU Law (Revocation and Reform) Act 2023.
VAT treatment of private hire vehicles
- The government will consult in early 2024 on the impacts of the July 2023 High Court ruling in Uber Britannia Ltd v Sefton MBC.
See Autumn Statement 2023: VAT
Reforming requirements to file a Self Assessment tax return
From 2024-25:
- Individuals with income taxed only through Pay As You Earn will no longer be required to file a Self Assessment return.
Tougher consequences for promoters of tax avoidance
From Royal Assent of Autumn Finance Bill 2023:
- A criminal offence for promoters of tax avoidance who continue to promote avoidance schemes after receiving a Stop Notice requiring them to stop promoting schemes described in that notice will apply.
- A new power will be introduced enabling HMRC to bring disqualification action against directors of companies involved in promoting tax avoidance, including those who control or exercise influence over a company.
Doubling maximum sentences for tax fraud
From Royal Assent of Autumn Finance Bill 2023:
- As announced at Spring Budget 2023, legislation in Autumn Finance Bill 2023 will double the maximum sentences for the most egregious forms of tax fraud from seven to 14 years.
Improving the data HMRC collects from its customers
From 2025-26:
- Legislation in Autumn Finance Bill 2023 will require employers, company directors, and the self-employed to provide new or improved data to HMRC to enable better outcomes for citizens and businesses.
- Employers will be required to provide data on employee hours paid via PAYE.
- Self Assessment taxpayers will be required to provide dividend income and the percentage shareholding in owner-managed businesses separately to other dividend income, and, for trading businesses, the start and end dates of self-employment.
- Regulations will be laid in Spring 2024.
Investment in HMRC debt management capability
- The government is investing a further £163 million to improve HMRC’s ability to manage tax debts.
- This will allow HMRC to better distinguish between those who can afford to settle their tax debts, but choose not to, from those who are temporarily unable to pay and need support.
- HMRC will also expand its debt management capacity to support both individual and business taxpayers out of debt faster and collect debts that are due.
Freeports
- The sunset date for the Freeport tax reliefs will be extended to 30 September 2031 for Freeports in England.
- For Freeports in Scotland and Wales, the reliefs will be extended from five to ten years, subject to agreement with the devolved administrations.
Investment Zones
- Investment Zones tax reliefs will be extended from five to ten years.
See Investment Zones: Tax breaks
Help to Save reform
- The government is reforming the Help to Save scheme.
- The new design will be published in due course, alongside the launch of a consultation on the most effective way to deliver it.
Plastic Packaging Tax rate
From 1 April 2024:
- The rate of Plastic Packaging Tax will increase from £210.82 per tonne to £217.85 per tonne.
Business rates: multiplier
From April 2024:
- The small business multiplier in England will be frozen at 49.9p.
- The standard multiplier will be uprated by September CPI to 54.6p.
See Business Rates: What's new?
Business rates: retail, hospitality, and leisure relief
From April 2024:
- The current 75% relief for eligible retail, hospitality, and leisure properties is extended for 2024-25.
- Around 230,000 retail, hospitality, and leisure properties in England will be eligible to receive support up to a cash cap of £110,000 per business.
See Business Rates: What's new?
Alcohol duty
- Rates of alcohol duty are frozen until 1 August 2024
- The annual uprating decision announcement is delayed until Spring Budget 2024 to give businesses time to adapt to the duty system introduced on 1 August 2023.
Tax treatment of remote gambling
- A consultation on proposals to bring remote gambling (gambling offered over the internet, telephone, TV and radio) into a single tax, rather than taxing it through a three-tax structure as at present will be published.
Tobacco duty rates
From 6 pm on 22 November 2023:
- The duty rates for all tobacco products will be increased by the tobacco duty escalator of 2% above inflation (based on the Retail Price Index (RPI))
- The rate for hand-rolling tobacco will be increased by an additional 10% above the escalator, to 12% above RPI inflation.
Aggregates Levy
From 1 April 2024:
- Aggregates Levy increases from £2.00 to £2.03 per tonne.
From 1 April 2025:
- The rate of Aggregates Levy will increase for 2025-26 in line with the Retail Price Index (RPI).
Landfill Tax
From 1 April 2024:
- The standard rate of Landfill Tax increases from £102.10 to £103.70 per tonne.
- The lower rate of Landfill Tax increases from £3.25 to £3.30 per tonne.
Gaming Duty
- The Gross Gaming Yield bandings for gaming duty will be frozen from 1 April 2024 until 31 March 2025.
External links
Autumn Statement 2023: Full statement
Autumn Statement 2023: Overview of tax legislation and rates (OOTLAR)
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