Autumn Statement to take place on 25 November
In late July, the Chancellor announced that the results of the Spending Review would be announced on 25 November. At the time he made no reference to the Autumn Statement, probably because the focus was still on his July Budget. However, in the beginning of September an exchange between Mr Osborne and the Office for Budget Responsibility revealed, much as expected, that 25 November will also see the publication of the Autumn Statement.
In recent years the Autumn Statement has increasingly become more like a second Budget – last year’s was particularly notable in this regard. This time around there may not be quite such a Budget overlay, if only because the Chancellor has already presented two budgets in 2015. In July’s he announced most of the income tax details for next tax year, revising figures he had put forward in March. It is difficult to imagine he will make further changes on this front.
Nevertheless there will be two areas worth watching:
- Pensions – The July Budget was accompanied by a consultation paper on the future of pension taxation, which contained little detail, but hinted at the end of higher rate tax relief – and possibly all tax relief – on contributions. The results of that consultation, which ended last month, could appear in November.
If you are contemplating making a one-off pension contribution in coming months, it may be wise to act before 25 November.
- National Insurance Contributions (NICs) – The Treasury is in the throes of overhauling NICs for the self-employed and has said it aims to scrap the weekly Class 2 payment and just have a Class 4 earnings related payment. Tellingly, self-employed NICs were left out of the legislation to freeze NIC rates (along with income tax and VAT rates). The July reforms on dividend taxation, which take effect from 2016/17, were designed to discourage the self-employed from incorporating.
We might see why in November – some commentators are predicting a rise from 9% to 12% in the main Class 4 rate. To learn more about the potential impact of the Autumn Statement on you please get in touch with one of our Independent Financial Advisers.