For 2022/23 to 2025/26, the personal allowance will remain at £12,570 and the higher rate threshold at £50,270, as previously announced. In Scotland, the higher rate threshold for non-savings, non-dividend income will be announced in the Scottish Budget on 9 December.
The dividend allowance will remain at £2,000. The rate of tax on dividends above the dividend allowance will rise by 1.25 percentage points from 2022/23, as announced in September 2021.
Tax year Basic rate Higher rate Additional rate
2021/22 7.50% 32.50% 38.10%
2022/23 onwards 8.75% 33.75% 39.35%
The dividend trust rate of tax will be 39.35% for 2022/23.
Don’t lose your personal allowance. Your personal allowance of £12,570 is reduced by 50p for every pound by which your income exceeds £100,000. You may be able to make a pension contribution or a charitable gift to bring your income below £100,000.
national insurance contributions (NICs)
The lower NIC thresholds and limits will rise by 3.1%, in line with CPI inflation to September 2021. The upper earnings limit, upper secondary thresholds and upper profits limit will remain aligned to the unchanged higher rate threshold at £50,270 for 2022/23, as previously announced.
NIC rates will rise by 1.25 percentage points in 2022/23, as announced in the NHS/social care package launched in September 2021. From 2023/24, NIC rates will revert to their previous levels and a new 1.25% Health and Social Care Levy will apply to employers, employees and the self-employed (including those above State pension age).
Tax year Employer: Class 1 Employee: Class 1 Self-employed: Class 4 Main Higher Main Higher
2021/22 13.80% 12.00% 2.00% 9.00% 2.00%
2022/23 15.05% 13.25% 3.25% 10.25% 3.25%
NICs increase from 6 April 2022. Salary sacrifice arrangements, for example for employers rather than employees to make pension contributions, will offer even greater savings in 2022/23.
pension contribution tax relief
In 2025/26, a new system will be introduced so that HMRC can make 20% top-up payments in respect of contributions made from 2024/25 onwards directly to low-earning individuals saving in a pension scheme using a Net Pay Arrangement. At present such contributions may not benefit from any tax relief and these top-ups will help align their outcomes with equivalent savers using Pension Relief at Source to save into pension schemes.
pension charge cap
There will be consultation on further changes to the regulatory charge cap for defined contribution pension schemes to unlock institutional investment to support some of the most innovative businesses.
company car tax
The company car tax rates already announced for 2022/23 will remain frozen until 2024/25, as announced at Budget 2020. From 2022/23 there will be no difference in the scale rate for emissions measured on NEDC or WLTP cycles.
individual savings account (ISA) subscription limits
The ISA annual subscription limit for 2022/23 will remain at £20,000 and the corresponding limit for junior ISAs (JISAs) and child trust funds (CTFs) will stay at £9,000.
National Savings & Investment (NS&I) Green Savings Bonds
Green Savings Bonds, which were announced in the March 2021 Budget, were launched by NS&I on 22 October and will be on sale for a minimum of three months. The NS&I Green Savings Bonds are a three-year fixed-term savings product with an interest rate of 0.65% and investment limits between £100 and £100,000.
The lifetime allowance for pension savings will remain frozen at £1,073,100.
capital gains tax
Capital gains tax (CGT) annual exempt amount
The annual exempt amount for individuals and personal representatives will remain at £12,300 for 2022/23 and the annual exempt amount for most trusts will likewise remain at £6,150 (minimum £1,230).
CGT – property payment window
From 27 October 2021, the deadline for UK residents to report and pay CGT after selling UK residential property will increase from 30 days to 60 days after completion. For non-UK residents disposing of property in the UK, this deadline will also increase from 30 days to 60 days. Legislation will clarify that when UK residents dispose of mixed-use property, the 60-day payment window will only apply to the residential element of the property gain.
Inheritance tax (IHT)
The IHT nil rate band will remain at £325,000 for 2022/23. The residence nil rate band (RNRB) will likewise stay at £175,000 and the RNRB taper will continue to apply where the value of the deceased’s estate is greater than £2 million.
Information on the Autumn budget and business here