DIVIDEND TAX

Dividend tax credits will be abolished from April 2016 and there will be a new dividend tax allowance of £5,000 a year. Above that level the tax rates will rise by 7.5%. 

NIC FOR EMPLOYERS

The national insurance contribution (NIC) employment allowance of £2,000 will rise to £3,000 from April 16. This only applies to employers who employ staff and not available to those payrolls that have directors only.

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IHT MAIN RESIDENCES

There will be an extra transferable IHT nil-rate band for main residences passed on death to direct descendants, starting at £100,000 in 2017/18 and rising to £175,000 in 2020/21   

CORPORATION TAX RATE 

The corporation tax rate will be reduced from 20% to 19% in the financial year 2017, and 18% in 2020.   

AIA ANNUAL INVESTMENT ALLOWANCE 

The annual investment allowance available to businesses will be reduced to £200,000 from 1 January 2016.


Income Tax – Personal Allowances and Basic Rate Band

The personal allowance for 2016/17 will rise from 10,600 to 11,000 and the basic rate band will rise by £215 to £32,000.

From 2017/18 the personal allowance will increase to £11,200 and there will be a further increase in the basic rate band to £32,400. Once the personal allowance reaches 12,500 it will be upgraded with the national minimum wage. 

Residential Landlords – Reform of the Wear and Tear Allowance

The wear and tear allowance will be replaced from April 2016 with a new relief that allows all residential landlords to deduct the actual costs 

of replacing furnishings. Capital allowances will continue to apply for landlords of furnished holiday lets. 

 Rent-A-Room Relief

 From 6th April 2016 the level of rent-a- room relief will be increased from £4,250 to £7,500 a year.Self-employed National Insurance Contributions

The government will consult in autumn 2015 on abolishing class 2 NIC’s and reforming class 4 NIC’s.