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Autumn Statement 2022 – Full In Depth Look

When the Chancellor of the Exchequer makes a fiscal statement to Parliament – whether it is called a Budget, a mini-Budget or an Autumn Statement – the headlines are in the speech and the details are in the Treasury Red Book that is published on the internet when he sits down. In normal times, it is hard enough to keep track of changes that come in immediately, changes that are coming soon, and proposals that are on the horizon.


This year is not normal. There have been four Chancellors and three fiscal statements. The challenge following Jeremy Hunt’s first Autumn Statement has been to identify what, if anything, of Kwasi Kwarteng’s proposals survived, as well as understanding the steps he has taken to fill the holes in the government coffers that the ill-fated September ‘Plan for Growth’ helped to create.


Sometimes an awareness of what has not been said can be important too.


This document summarises the main changes that were announced by Mr Hunt, as well as setting out what has survived and what has been cancelled from the September plan, and points out some of the rumoured possibilities that have come to nothing.


One of Mr Hunt’s tax-raising measures is a promise to freeze the main thresholds for income tax and inheritance tax for the next five years. That may be something of a relief after a year in which three different sets of National Insurance rates have applied, but the effects of inflation will draw more people into paying these taxes and more of them into liability for higher rates. There are also more obvious tax rises through reductions in reliefs and exemptions and a lowering of the point at which the top rate of income tax applies.


Significant points


  • basic rate of income tax to remain at 20% and additional rate at 45% for 2023/24
  • most tax rate bands frozen at current levels until 5 April 2028
  • 45% rate will apply to income above £125,140 in 2023/24
  • dividend income and capital gains to be more heavily taxed from 2023/24
  • no changes announced to pension tax reliefs
  • inheritance tax thresholds now frozen until 5 April 2028
  • corporation tax rate increase to 25% from 1 April 2023 restored
  • VAT registration threshold frozen at £85,000 for two more years, to 31 March 2026
  • affirmation of support for the state pension ‘triple lock’ with an inflation-linked increase from April 2023


Download the full Autumn Statement 2022 report

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The UK's tax system for individuals classed as "not UK domiciled" (often called "non-doms") is undergoing a significant overhaul. This system has traditionally offered tax advantages for foreign income and gains, but those benefits are coming to an end. Non-domiciled individuals are generally those who haven't established strong ties to the UK in terms of residence or family connections. Previously, they enjoyed a tax perk known as the "remittance basis of taxation." This allowed them to avoid paying UK income tax on foreign income and capital gains, as long as the money remained outside the UK. However, these advantages have been gradually restricted in recent years. The new reforms, announced by the Chancellor of the Exchequer – Jeremy Hunt, represent a change to the existing non-dom tax system. The New System - What Does it Mean Non-Doms in the Future? Starting April 6th, 2025, a new system will be in effect. Here's what it entails for non-domiciled individuals who become UK resident after that date: Temporary Tax Exemption: If you haven't been a UK resident in the past 10 years and become one after the reform, you'll benefit from a temporary tax exemption. This means your foreign income and gains will be exempt from UK income tax for the first four years of your UK residency. Standard Taxation After Four Years: After the initial four-year grace period, your foreign income and gains will be taxed on the same basis as other UK residents. To avoid double taxation, relief will be available against UK tax under Double Tax treaties or the Unilateral system for any foreign tax already paid. What about Existing Non-Doms? The government acknowledges the complexities of transition for current non-dom who are UK residents. Transitional rules are being considered to ease the shift. These may include: Reduced Tax Rate for Bringing Foreign Income to UK: Existing non-doms might be offered an opportunity to bring previously untaxed foreign income and gains back to the UK at a reduced tax rate. Rebasing Foreign Assets for Capital Gains: There's also a possibility of "rebasing" the value of non-domiciled individuals' foreign assets for capital gains tax purposes. This could mean using the asset value in 2019 as a baseline, potentially reducing their future capital gains tax liability. Uncertainties and Taking Action The details of the new system and the transitional rules are still under development. The full picture will become clearer when the government publishes further consultations later in the year. Given the complexities involved, it's crucial for individuals who might be affected by these reforms to seek professional tax advice. Understanding the opportunities and potential pitfalls of the new system can help you make informed decisions about your financial future. While the non-dom tax reform simplifies matters to a certain extent, it introduces new considerations for individuals with international finances. Staying informed and seeking professional guidance will be key to navigating these changes effectively.

Friend Partnership is a forward-thinking firm of Chartered Accountants, Business Advisers, Corporate Finance and Tax Specialists, based In The UK

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