Spring Budget 2023 – Key Announcements
Jeremy Hunt, the Chancellor of the Exchequer, delivered his Budget on Wednesday 15th March 2023, in which he unveiled big changes to pensions and childcare as part of an effort to tempt people back into work.
Whilst nothing directly affects property, mortgages or personal income tax, changes to pension allowances, corporation tax and free childcare will have an impact for millions, so the key points are well worth being aware of.
Here’s our summary of the main announcements:
- The lifetime allowance – currently £1.07m – to be abolished
- The tax-free annual allowance for pension pots to be raised from £40,000 to £60,000
- Money Purchase Annual Allowance to increase to £10,000 from April 2023
- The 5p reduction to fuel duty to be extended for another 12 months
- Duty on draught products in pubs to be up to 11p lower than the duty in supermarkets
- Corporation tax to go up from 19% to 25% for companies with over £250,000 in profits
- Every pound invested by businesses in machinery, plant or IT equipment to be deducted in full from taxable profits
- Twelve new Investment Zones to be created, backed by £80m of investment over five years
- Thirty hours of free weekly childcare for working parents to be extended to children from 9 months old (from late 2024)
- Energy Price Guarantee extended for three months until the end of June 2023
- Prepayment meter charges to be brought into line with direct debit charges
- Work Capability Assessment to be abolished and a new voluntary employment scheme for disabled people called Universal Support to be introduced
- Defence budget to increase by £11bn over the next five years
- The Office for Budget Responsibility (OBR) believes the UK will not enter a technical recession this year
- According to OBR estimates, the UK economy will contract by 0.2% this year, and then expand by 1.8% in 2024, 2.5% in 2025, 2.1% in 2026 and 1.9% in 2027
If this has got you thinking about moving, remortgaging, or your finances generally, we’d love to hear from you. Get in touch and we’ll be help you understand what’s possible, or sign up to our monthly newsletter, to keep your finger on the pulse.
Sam Murphy – 16th March 2023