Spring Budget 2023

Following the budget on 15 March 2023 we have compiled a list of the key changes from  April 2023:

  • Companies incurring expenditure on new plant and machinery from 1 April 2023 can avail of a “full expensing” deduction.  This replaces the 130% super deduction and is in place until 31 March 2026.  The deduction depends on whether the expenditure falls within the main or special rate pool for capital allowance purposes and there are special rules which will apply on the subsequent disposal
  • The Annual Investment Allowance has been permanently set at £1m for incorporated and unincorporated businesses
  • The maximum amount which an individual can add to their pension savings each year will increase from £40,000 to £60,000.  This coincides with an increase in the level of income at which the allowance starts to be tapered
  • The lifetime allowance for the maximum you can hold in pension savings will be abolished (currently £1,073,100)
  • The corporation tax rate will increase from 19% to a maximum of 25% with a marginal rate of tax applying to profits between £50,000 and £250,000
  • The enhanced rate of relief for R & D expenditure for SMEs will reduce from 130% to 86%
  • The tax free dividend allowance will be halved to £1000 for 2023/2024
  • The 45% tax band reduced from £150k to £125k for 2023/2024
  • CGT tax free band will be halved to £6000 (and reduced again in April 2024 to £3000)
  • Personal Allowance thresholds and Nil rate bands for IHT have been frozen until April 2028
  • VAT registration threshold remains unchanged at £85,000
  • Investment zones are being identified and will be specifically targeted towards knowledge-intensive growth clusters which will drive the growth of the government’s key future sectors and bring investment to areas which have underperformed economically.  Each of the devolved administrations in Scotland, Wales and Northern Ireland have yet to determine how this will be delivered in the respective areas.

Please contact our office if we can offer more help and advice regarding the above.

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