Businesses are holding their breath as the upcoming Autumn Statement threatens to change the tax landscape of the UK.
Chancellor of the Exchequer, Jeremy Hunt, will present the Statement to Parliament on 22 November 2023.
The cost-of-living crisis is becoming a serious political issue ahead of an upcoming general election. In addition, rising tax rates could see spending decrease and business costs rise further.
Why the Autumn Statement matters
The Autumn Statement outlines the Government’s fiscal plans for the upcoming year, including any changes to tax rates, allowances, and reliefs that could directly impact a company’s bottom line.
Businesses rely on this information to plan their budgets, assess their financial health, and make informed decisions about investments and growth.
What changes are likely?
The Chancellor will no doubt want to show that the Government is still committed to supporting businesses, but he has historically been known to raise taxes to attempt to maintain fiscal responsibility.
For example, Jeremy Hunt entirely reversed the previous Chancellor’s growth-based approach, which would have seen an end to high stamp duty thresholds.
Having said this, the UK has been on the brink of recession for the last few years, which might mean the Government reduces restrictive policies on businesses soon.
In addition, with an upcoming election around the corner, the Chancellor might encourage voting for the Conservatives with a generous approach to business and personal taxation.
Early warning signs
In the past, we have seen taxation plans leaked to determine public opinion for new policies. There have already been rumours of plans to alter, or even entirely cut, Inheritance Tax (IHT) ahead of the next election to woo voters.
Therefore, it is worth keeping an eye on developments running up to the Autumn Statement for indications of new regulatory changes.
What should you do to prepare?
Preparing for the Autumn Statement is vital for businesses looking to maximise their tax efficiency going into the next financial year.
Businesses should engage in proactive financial planning to prepare for potential changes in the tax landscape.
Discussing these issues with an accountant can help simplify your tax obligations and reduce the strain on your business.
We will be bringing you further updates from the Autumn Statement in future, but if you have any immediate queries about taxation contact us.