Budget Summary November 2017
- Limit at which people start paying tax to be raised to £11,850 from 6th April 2018 in line with inflation
- Higher rate tax threshold to be increased from £45,000 to £46,350 from 6th April 2018
TBOS COMMENT – With an increase in personal allowance, it means more low-paid workers will not be taxed and should mean more money in your pocket each month. The £350 increase in the basic rate threshold will mean taxpayers will get £70 in their pocket per year, assuming there is no change in their wages. Higher earners also will see a benefit due to the increase in the higher tax rate threshold.
CHANGES TO TAXATION FOR DIRECTORS
- From 6th April 2018, the tax-free allowance on dividends will be decreased from £5,000 to £2,000.
TBOS COMMENT – With the changes to the tax-free allowance on dividends, directors will now incur an increased level of tax (7.5% of the £3,000 reduction). For directors currently taking dividends above the £5,000 tax-free allowance, this will result in an increase of £225 in income tax (assuming dividend tax rates remain consistent).
HELP FOR BUSINESS
- VAT threshold for small business to remain at £85,000 for 2 years
- Rises in business rates to be pegged to CPI measure of inflation, not higher RPI, a cut of £2.3bn
TBOS COMMENT – For those businesses that don’t qualify for the small business rates relief, the rise in business rates will be mitigated by using a different measure of inflation. The static VAT threshold may see more companies having to register for VAT.
- From 1st April 2018, National Living Wage will increase to £7.83 p/h
TBOS COMMENT – A review of any current internal staff or PAYE contractors will need to be performed to ensure that all PAYE staff and contractors are earning over the equivalent of £7.83 per hour for their employment.
TRANSPORT AND INFRASTRUCTURE
- £500m support for 5G mobile networks, full fibre broadband and artificial intelligence
- £540m to support the growth of electric cars, including more charging points
- A further £2.3bn allocated for investment in research and development
- £30m to develop digital skills distance learning courses
- £320m to be invested in former Redcar Steelworks site
- £1.7bn city region transport fund to be shared between six regions
- £30m to improve mobile and digital connectivity on TransPennine rail route
- £2bn for Scottish government, £1.2bn for Welsh government and £650m for Northern Ireland executive
- Scottish police and fire services to get refunds on VAT from April 2018
- Young person's railcard extended to 26-30-year-olds, giving a third off rail fares
TBOS COMMENT – This is good news for the telecoms industry with broadband networks and a 5G hub being invested in, which could in turn create further recruitment opportunities in these industries. The investment in research and development along with a focus on artificial intelligence will potentially open up new positions that currently aren’t being recruited into. For any companies in training or automotive industries, the increase in funding may give rise to new opportunities in these sectors.
EDUCATION AND HEALTH
- £40m teacher training fund for underperforming schools in England, worth £1,000 per teacher
- 8,000 new computer science teachers to be recruited at cost of £84m and new National Centre for Computing to be set up
- Secondary schools and sixth-forms to receive £600 each additional pupil taking Maths or further Maths at A-Level
- £2.8bn in extra funding for the NHS England
- £10bn capital investment fund for hospitals up to 2022
- £28m for Kensington and Chelsea council to provide counselling services and mental health support for victims of the Grenfell fire and for regeneration of surrounding area
TBOS COMMENT – This is good news for both education and health recruitment, with the additional investment in recruiting 8,000 new computer science teachers there are opportunities to increase perm placements for education recruitment. Potential opportunities in the training sector also arise from the £40m fund available for teacher training. Healthcare will benefit from a capital investment and also additional funding for the NHS; this will increase budgets for hospitals and potentially be reflected in their contract recruitment requirements.
ENERGY AND THE ENVIRONMENT
- Proceeds from company car tax rise and vehicle excise duty to fund £220m clean air fund for pollution hotspots in England
TBOS COMMENT – Although little information is available on how the funds will be used, there may be opportunities arising in clean energy solutions.
- Stamp duty to be abolished immediately for first time buyers purchasing properties worth up to £300,000. For first time buyers in London, the next £200,000 will only incur 5% stamp duty
- £44bn in overall government support for housing to meet target of building 300,000 new homes a year by the middle of the next decade
- £400m to regenerate housing estates and £1.1bn to unlock strategic sites for development
TBOS COMMENT – The additional funding for new housing and also the reduction in stamp duty for first time buyers will promote opportunities in the construction industry for recruitment for new housing developments and also identifying strategic sites for development.
FUEL, TOBACCO AND ALCOHOL
- Fuel duty rise for petrol and diesel cars scheduled for April 2018 has been scrapped
- Vehicle excise duty for cars, vans and motorcycles registered before April 2017 to rise in line with inflation
- Existing diesel supplement in company car tax to rise by 1%
- Beer, Cider, Wine and spirits duty will be frozen
- Tobacco will continue to rise 2% above retail price index and the minimum excise duty introduced in March will also rise
- Duty on rolling tobacco will increase by additional 1%
TBOS COMMENT – For any directors that currently have company cars, the rise in all duties except alcohol means it is worth noting that rise of the additional supplement for diesel cars, meaning that petrol cars will be a more attractive proposition going forward.