How will the Spring Budget 2017 Affect Manchester Businesses?
Spring Budget 2017: Key Points at a glance
- UK growth up this year; borrowing coming down
- Increase in National Insurance tax contributions for self-employed people
- Tax-free dividend allowance falls from £5,000 to £2,000 in April 2018
- Measures for business rates effectively give a £435m cut, including a £1,000 cut for nine out of ten pubs
- £2bn for social care
- £100m for new triage programmes in English hospitals
Spring Budget 2017 Overview
Self-employed Mancunians could be facing an increase in National Insurance contributions as the Chancellor decides to tackle what he called an unfair burden on people in employment in his budget this week. The increase came despite the Conservatives’ manifesto pledge not to raise the rate of National Insurance.
The 9% rate of NI on self-employed profits will rise first to 10% and eventually to 11% in a bid to raise an additional £2bn of tax revenue in the current Parliament. Philip Hammond said this is because more Britons are now choosing to work for themselves. He cited a preliminary review that found they paid lower rates of tax compared to those in employment.
Mr Hammond also targeted Manchester self-employed people such as footballers and media personalities who use a personal service company to pay themselves in dividends. The tax-free allowance these such payments will be cut back from £5,000 to £2,000 – raising £2.5bn before the next General Election. The move will hit investors as well as the Manchester self-employed, but only those with more than £50,000 held in stocks and shares outside ISA wrappers will be affected.
The proposed changes come despite stronger than anticipated growth. The Government’s fiscal watchdog, The Office of Budget Responsibility (OBR), revised its borrowing forecasts for the next five years and said Britain’s debt would fall faster than previously predicted.
The Chancellor also announced plans to reduce business rates for most pubs and used the funds raised by the changes in the budget to pay for improvements to social care and triage programmes for English hospitals.
Spring Budget 2017 – Assured Wealth & Estate Planning Manchester
Talk to our Warrington Financial Advisor, West Kirby Financial Advisor, Altrincham Financial Advisor, Liverpool Financial Adviser, Wilmslow Financial Advisor or Manchester Financial Adviser team today about how the Spring 2017 budget will affect Manchester businesses and self-employment.