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Chancellor Jeremy Hunt gave his 2023 Autumn Statement this week.
Read on to find out the key changes and how you may be affected.
Cuts to National Insurance.
Whilst Jeremy Hunt didn't unveil any plans to reduce personal taxes, he did announced the following changes to National Insurance:
For employees...
The main rate of Class 1 Employee's National Insurance will be cut by 2 percentage points, from 12% to 10%, for employees earning in excess of £12,570.
This change will come into effect from 6th January 2024 and is expected to benefit 27 million people.
For the self-employed...
If you're self-employed, you'll benefit from two new measures announced by the Chancellor, both of which will apply from April 2024:
Class 2 National Insurance will be scrapped entirely. This is currently a flat rate of £3.45 per week and was originally due to rise to £3.70 per week from April 2024.
Class 4 National Insurance will drop from 9% to 8% on profits over £12,570.
The National Living Wage will increase.
The National Living Wage, which is currently £10.42 per hour, will increase to £11.44 from April 2024.
Whilst this previously only applied to employees aged 23 and over, the National Living Wage will now apply to those over the age of 21.
Single pension pot.
The Chancellor will be consulting on reforms to allow employees to choose their own pension scheme, rather than having to join their employer's default pension scheme.
The current rules mean that UK businesses are required to set up a pension scheme for employees, however, with most people changing jobs at various times throughout life, there is a growing risk of pension savings getting 'lost'.
95% mortgage guarantee scheme extended.
The mortgage guarantee scheme consists of the Government 'guaranteeing' 95% mortgages for buyers with a 5% deposit. This initiative came about in April 2021, with the aim of encourging banks to begin offering 95% mortgages again, after practically every single one was rescinded during the pandemic.
This scheme was due to end in December 2023, however it has now been extended until June 2025.
Got questions on any of the Chancellor's changes? Feel free to contact us here.
*All information is correct at the date of this article going live.
*The information as per this article is not to be taken as specific advice. If you require any advice that is specific to your own situation, contact our experts today.