`The Chartered Institute of Payroll Professionals
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While the autumn statement might not have been as full of thrills for the payroll profession as the ‘mini - budget’, there are still things we need to be aware of.
The big announcement for tax was the reduction of the additional rate earnings threshold. This is to be reduced from £150,000 to £125,140 from 6 April 2023. This did not come as a shock to many as it was heavily rumoured prior to the statement.
Along with this, all other thresholds and rates will be frozen until 2028, a further two years on previous plans. This is on top of the indefinite delay to the basic rate of tax reduction that was scrapped as part of the growth plan roll back.
In addition, dividend allowance will be reducing from £2,000 to £1,000 next year. This will half again in April 2024 to £500. Similarly, the tax-free allowances for capital gains tax will reduce from £12,300 this year to £6,000 in 2023/24 and £3,000 in 2024/25.
The full autumn statement documentation can be found here.
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Autumn Statement calms NI turbulence Published: 22 November 2022 Emailed: 23 November 2022
After a year of many, many changes, especially to national insurance (NI), the Autumn Statement was cautiously viewed by payroll professionals. With Rishi Sunak as prime minister, we may have seen a return of the health and social care levy, which he introduced as chancellor. In stark contrast to the previous months, all remains calm with regards to NI. No more changes this year. However, this does not mean there is nothing to announce. The NI thresholds will remain fixed for an additional 2 years. Due to be fixed until April 2026, they will now remain constant until April 2028. Employment allowance will also remain at £5,000. No changes to NI are currently planned. As wages grow, this will generate more revenue for the Treasury, what is referred to as a ‘stealth tax’. This, at least, gives employees and employers the ability to plan for the future without unexpected additional costs in relation to NI.
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2023/24 statutory payments released in benefits and pensions document Published: 24 November 2022 Emailed: 30 November 2022
One of the big announcements from the Autumn Statement was that the pensions triple lock will be honoured. Meaning that state pension rates will rise with the September figure for inflation, 10.1%.
The Department for Work and Pensions (DWP) has released the benefits and pension rate document detailing the rates currently known for 2022/23 and 2023/24. This confirms state pension at £203.85 for 2023/24.
Also included in the document is the statutory payment amounts for next tax year.
Statutory maternity, paternity, adoption, shared parental and parental bereavement pay will all be set at £172.48 per week and statutory sick pay will be set at £109.40 per week.
The document has details on a raft of other benefits and allowances.
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