What are the latest changes to the mini-budget?
A summary of changes since the mini-budget announcement on 23rd September 2022.
The government have announced they will reverse almost all tax measures set out in September’s mini-budget.
One huge U-turn impacting the contracting community is that the 2017 and 2021 off-payroll working reforms will remain.
In summary, some of the changes include:
The 2017 and 2021 off-payroll working reforms will remain, and the April repeal will no longer go ahead.
The government stated this reform would have cost £2bn a year.
The basic rate of income tax will remain at 20% indefinitely, instead of being cut to 19% in April.
This means workers in England, Wales and Northern Ireland who earn between £12,571 and £50,270 will pay 20% on their annual earnings.
September’s mini-budget also included a pledge to reduce the 45% higher rate of income tax, however the 45% rate of income tax will now remain for people earning above £150,000.
This will no longer be cut by 1.25 percentage points.
This will rise to 25% from April 2023.
VAT-free shopping for visitors from abroad has been cancelled, and no freeze will take place for alcohol duty.
For guidance on off-payroll working rules, visit: Understanding off-payroll working (IR35) - GOV.UK (www.gov.uk)