Budget Highlights 2017

  • Income tax

    The personal allowance for the tax year 2017/18 has been increased to £11,500.

    Class 2 and Class 4 National Insurance contributions (NICs)

    The government will abolish Class 2 NICs on self-employed from April 2018. The rate of Class 4 National Insurance will increase from 9% to 10% in April 2018, and then to 11% in April 2019. Taking together, only the self-employed with profits over £16,250 will have to pay more national insurance as a result of these changes.

    Dividend Allowance

    The tax-free dividend allowance will be reduced from £5,000 to £2,000 from April 2018.

    Corporation Tax Rate

    As set out at Autumn Statement, the government will cut the rate of corporation tax to 19% from April 2017 and then again to 17% in 2020.

    Digital Administration

    The government will provide an extra year until April 2019, before making tax digital is mandated for unincorporated businesses and landlords with turnover below the VAT threshold.

    Lifetime Individual Saving account

    The launch of a new Lifetime Individual Savings Account (LISA) for those aged between 18 and 40. They can save up to £4,000 a year, and the government will add a 25% bonus if the money is used to buy a home or as a pension from the age of 60.

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