23 Mar 2022

Spring Statement 2022: A timeline of upcoming business tax changes

Rishi Sunak’s Spring Statement may have contained few major new tax changes affecting small and medium-sized enterprises (SMEs) – with the promise of more reforms to come in the Autumn Budget – but it’s worth remembering that a number of previously announced measures have yet to come into force.

Here we roundup what upcoming changes business owners need to be prepared for and when they take effect:

  • Fuel duty on petrol and diesel will be cut by 5p a litre, effective for 12 months from 6pm on March 23
  • Employment Allowance for small businesses increases to £5,000
  • National Insurance increases by 1.25% for employers until the new Health & Social Care Levy becomes a separate tax in April 2023 (announced in September)
  • The lower profits limit for Class 4 National Insurance contributions paid by the self-employed increases to £11,908
  • Dividend income tax rates increase by 1.25% (announced in September)
  • Residential property developer tax is due to be introduced, bringing in a 4% tax on companies with profits above £25m (announced in the Autumn 2021 Budget)
  • VAT on tourism and hospitality returns to the standard rate of 20% when the temporary 12.5% rate ends (announced in the Spring 2021 Budget)
  • The primary threshold for employee National Insurance contributions increases to £12,570, bringing it into line with the income tax personal allowance
  • Temporary increase in the Annual Investment Allowance to £1m ends, reducing to £200k, instead of happening at the end of December 2021 as originally planned (announced in Autumn 2021 Budget)
  • Corporation tax increases from 19% to 25% (announced in the Spring 2021 Budget)
  • The super-deduction and 50% first year capital allowances comes to an end (announced in the Spring 2021 Budget)
  • Business rates multiplier is unfrozen and 50% relief for retail, hospitality and leisure sectors ends (announced in Autumn 2021 Budget)
  • Research & Development tax credit restricted to UK domestic expenditure (announced in Autumn 2021 Budget)
  • The lower profits limit for Class 4 National Insurance contributions paid by the self-employed increases to £12,570, bringing it into line with the income tax personal allowance
  • Temporary increase in headline rates of tax relief for theatres, museums, orchestras and galleries ends (announced in Autumn 2021 Budget)

For more Spring Statement analysis, visit our Budget hub.

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