As expected, the Chancellor lived up to his reputation as a cautious operator and made very few significant tax announcements in his final Spring Budget. Both the medium-term economic policy and the direction of travel of the tax regime were confirmed, and the government will proceed with the gradual reduction of corporation tax rates and the introduction of interest and loss relief restrictions. At the link below, please find our summary of the main tax announcements.
Highlights for business include:
- Corporation tax rate confirmed down to 17 % by 2020
- Amendments to proposed corporate interest restriction rules
- Increase of main rate of Class 4 National Insurance Contributions (NICs) by 2 % over the next two years to bring self-employed and those using personal service companies into greater alignment with employees
- Reduction of new tax-free dividend allowance from £5,000 to £2,000
- Targeted reliefs on business rates for pubs and small businesses