Spring Budget 2017 – our summary for business owners and private individuals
Philip Hammond’s focus in the 2017 Budget was firmly on government spending and investment and what he described as improving fairness in the tax system. This was the last spring budget – the annual budget will move to the Autumn this year, giving businesses and individuals more time to plan for announced changes going forward.
There was some good news on the economy. Amongst the major advanced economies, Britain’s growth in 2016 was second only to Germany. Employment is at a record high and unemployment is at an 11-year low. Also, reflecting the recent strength in the economy, the OBR has upgraded its forecast for growth this year from 1.4% to 2%.
The Budget attempted to address the difference in the tax system between employed and self-employed individuals through announcing changes to NICs and the Dividend Allowance and there is more to come. The Chancellor announced that a report will be delivered in the summer on the wider implications of different employment practices. Additionally, due to the controversy this planned increase in self-employed NICs has caused, it has already been announced by the Prime Minister that this legislation will not be put before the Commons until the Autumn. Watch this space!
The fact that relatively few tax changes otherwise were announced for businesses should be well received. Smaller businesses will benefit from changes to the business rate regime and a delay in the introduction of digital filing for some businesses and landlords.
In December and January, the government issued a number of the clauses, in draft, of Finance Bill 2017 together with updates on consultations. The Budget updates some of those announcements and also proposes further measures. Some changes apply from April 2017 and some take effect at a later date.
Our summary focuses on the issues likely to affect you, your family and your business. To help you decipher what was said we have included our own comments. If you have any questions, please do not hesitate to contact Anne-Maree Dunn or your usual WMT tax partner for advice.