Autumn Statement 2023!

Accredited Supplier, Sones Accountancy Services provides a summary of the Chancellor's Autumn Statement 2023.

It’s that time of year again. The gold and crimson leaves are falling from the trees, the days are shorter and there is a definite chill in the air.  It must be time for the Autumn Statement!

The rumours circulating were that the big announcements would centre around a cut to national insurance, an increase to the minimum wage, and extending full capital expensing for companies investing in capital items. So, were these rumours to be believed?

The Chancellor of The Exchequer, Jeremy Hunt, delivered the Autumn Statement against a background of rising inflation and cost of living pressure.  Here are some of the headlines:

●     The Chancellor reported that The Office for Budget Responsibility (OBR) shows the economy will grow by 0.6% this year and 0.7% next year.

●     Inflation is expected to fall to 2.8% by the end of 2024.

●     The OBR expects the Bank of England Base Rate to stay at around 4% until the end of 2028.

Some of our key takeaways from the Autumn Statement are:

Full Expensing

Companies investing in IT, machinery and equipment will continue to benefit from full expensing. For every £1 spent on these items, a company can reclaim 25% in corporation tax.  This scheme was set to end in 2026, however, it has been announced that the scheme will continue permanently.

Business Rate Relief

The 75% discount on business rates up to £110,000 for retail, hospitality and leisure businesses will continue for a further year. 

National Insurance Cuts

From April 2024, Class 2 National Insurance contributions will be abolished for self-employed people earning more than £12,570. These are the contributions the self-employed currently pay at £3.45 per week.

From April 2024, Class 4 National Insurance contributions will be reduced from 9% to 8% for self-employed people earning £12,570-50,270.

From 6th January 2024, the National Insurance rate for employees will be cut from 12% to 10%.

National Living Wage

From April 2024, the minimum wage will rise from £10.42 to £11.44. Previously this higher hourly rate was for employees aged over 23, but it will be extended to 21 and 22 year olds.

Also, from April 2024, 18 to 20 year olds will be paid a minimum of £8.60 and 16 to 17 year olds will be paid a minimum of £6.40 per hour.

We would love to discuss how the Autumn Statement impacts your business and your plans for the future.  If you have concerns about how to navigate these changes and need guidance, feel free to contact us.