UK likely to avoid recession amidst announcement of tax reliefs
The Chancellor of the Exchequer presented his Spring Budget to Parliament today. In doing so, it seemed he was not only hoping to shake off the unpredictability of his predecessors, but to establish stability — and indeed growth — within the UK economy.
Chancellor Jeremy Hunt’s economic goals were summed up under the tagline of ‘levelling up’. The Chancellor was keen to reassure that the Government’s fiscal plan was working; providing assurance that the UK economy will avoid a recession and forecasting that economic growth will commence by the end of 2023. Inflation is also predicted to drop to 2.9% by the end of the year.
In respect of aiding business finance, some tax reliefs were announced. Chancellor Hunt highlighted a new £9bn policy of full capital expensing, which means every single pound a company invests in I.T equipment, plant or machinery can be deducted in full and immediately from taxable profits. This will allow firms to write off all qualifying capital investment against their corporation tax bills for an initial 3-year period. However, the corporation tax rate increase from 19% to 25% will go ahead in April this year.
In regards to the cost of living crisis, Chancellor Hunt confirmed that the energy price guarantee will remain at £2,500 until the end of June — granting an extension of 3-months. In order to encourage the labour market to grow — and to support people to remain in, or return, to the workplace — packages of support were put in place to aid a plethora of individuals.
The Chancellor did announce important changes to pension and life-time allowances. These reforms will see the annual pension allowance increasing. It currently stands at £40,000 but will be £60,000 for next year. The pension lifetime allowance will now be completely abolished.
However, the real question will be how the Sprint Budget 2023 impacts on your finances. To help you with the headline points — as well as the more subtle changes — WHA have compiled a summary document to help you review what this Budget means for you.
To access the WHA Spring Budget 2023 summary, please click on the following link :
As always, the WHA Team are on hand to help you with any queries that you might have. Please feel to contact us on firstname.lastname@example.org or 0208 878 8383.