Reading Time | 2 mins

Autumn Statement 2016

Share this article

Key tax announcements of 23 November 2016 Autumn Statement.

This Autumn Statement was effectively a number of firsts. It was Philip Hammond’s first Budget as Chancellor; the first Budget of the Theresa May Government; and the first fiscal statement since the vote for Brexit. It was also the first time since 2010 (when George Osborne became Chancellor) that investment spending was more important than austerity. It was also the last Autumn Statement; to be replaced by a new Spring Statement.

And as first appearances go, Mr Hammond is a more serious-minded Chancellor than his predecessor and wants the country to start building – houses, roads, rail and digital infrastructure – to make us “Match Fit” for the turbulence of Brexit.

Hammond’s Autumn Statement was an opportunity to reset fiscal policy, heralding also a new industrial strategy to make the UK more productive through fiscal stimulus and targeted spending.

Recap – key tax changes previously announced

  • Tax free personal allowance £11,500 from April 2017
  • Higher rate threshold raised to £45,000 from April 2017
  • Apprenticeship levy for large companies from April 2017
  • Tax relief for landlord’s finance costs restricted from April 2017
  • Certain non-UK dom individuals become UK doms from April 2017
  • New IHT nil-rate band for residences from April 2017
  • £1,000 tax free allowances for micro businesses from April 2017
  • New Lifetime ISA for anyone under age 40 from April 2017
  • ISA annual limit becomes £20,000 from April 2017
  • Termination payments attract employers’ NIC from April 2018
  • Corporation tax reduced from 20% to 17% by 2020
  • Business rates devolved to local authorities by 2020

Autumn Statement 2016 key measures

  • Government will respond to the Making Tax Digital consultations in January 2017
  • Scrapped plans for a Budget surplus by 2020
  • No further welfare savings measures beyond those already announced
  • £23bn National Productivity Investment Fund
  • £2bn extra a year in R&D by 2020
  • £2.3bn housing infrastructure fund for 100,000 new houses
  • £1.4bn aimed at delivering 40,000 affordable new homes
  • £1bn to help upgrade Britain’s broadband to “full fibre”
  • 100% capital allowances for electric car recharging stations
  • £400m into venture capital funds to help start ups grow
  • Corporation Tax will fall to 17% by 2020 as planned
  • Employee / er NIC thresholds aligned at £157 per week from 2018
  • Insurance Premium Tax increases to 12% from 2017
  • Salary sacrifice schemes scrapped from April 2017 except for low emission cars, pensions, childcare and cycle schemes
  • From 2018, a simpler process for applying for Pay as You Earn Settlement Agreements
  • Tax avoidance measures on tax and VAT to raise £2bn
  • Corporate interest relief restrictions from April 2017
  • A promise to raise the personal allowance to £12,500 by 2020
  • A promise to raise the basic rate threshold to £50,000 by 2020
  • National Living Wage to rise to £7.50 per hour from April 2017
  • Reduction of the Universal Credit taper rate from 65p to 63p to help low paid
  • Banning upfront fees imposed by lettings agents in England
  • NSI Savings Bond with 2%+ interest rate from next year
  • Fuel duty frozen again
  • The charge for the Annual Tax on Enveloped Dwellings will rise in line with inflation for 2017/18

Finance Bill 2017

Whilst we have some information today on these announcements, the detailed provisions will be published on 5 December 2016 in Finance Bill 2017.

Property measures

Click here to read Zoe Robert’s blog post on the Autumn Statement from a property perspective.