The personal allowance is currently £11,500. The personal allowance for 2018/19 will be £11,850.
Tax bands and rates
The basic rate of tax is currently 205. the band of income taxable at this rate is £33,500 so that the threshold at which the 40% band applies is £45,000 for those who are entitled to the full personal allowance.
The government has announced that for 2018/19 the basic rate band will be increased to £34,500 so that the threshold at which the 40% band applies is £46,350 for those who are entitled yo the full personal allowance. The additional rate of tax of 45% remains payable on income above £150,000.
Reduction in the Dividend Allowance
The Dividend Allowance will be reduced from £5,000 to £2,000 from 6 April 2018.
Making Tax digital
The government announced significant changes to the timetable and scope of HMRC's digital tax initiatives for businesses. VAT will be the first tax where taxpayers will keep digital records and report digitally to HMRC. The new rules will apply from April 2019 to all VAT registered businesses. The government confirmed there will be no changes to the tax thresholds and these will be upheld for the next two years.
Corporation Tax Rates
The rate of corporation tax for the current year is 19%.
For the financial year from April 2018 to 2019 will remain at 19%.
For the financial year from April 2020 it reduces to 17%.
Future Tax changes
There were a number of proposed changes announced by the chancellor. These included:
The capital gains tax annual exemption is £11,300 for 2017/18 and will rise to £11,700 for 2018/19. The government had previously suggested that capital gains tax would have to be paid within 30 days of the sale of a residential property but this proposal has now been deferred until April 2020.
The nil rate band set at £325,000 is set to remain frozen until April 2021.
First Time Buyers
The government announced that first time buyers paying £300,000 or less for a residential property will pay no stamp duty tax. First time buyers paying between £300,000 and £500,000 will pay stamp duty at 5% on the amount of the purchase price in excess of £300,000. There will be no relief for first time buyers purchasing property above £500,000. These rules apply for completion dates on or after the 22 November 2017.