There was little good cheer in the Chancellor’s announcements to parliament on 27 October. A short summary of the good news is listed below:
- Annual Investment Allowance (AIA): The £1m limit to claims for tax relief when purchasing qualifying assets was due to return to a more modest £200,000 from the 1st of January 2022. This change has now been postponed until 31 March 2023. This takes the urgency out of decisions to purchase appropriate assets. This is a welcome extension of tax relief for capital expenditure, especially for unincorporated businesses who do not have access to the new 130% Super-deduction that is only available to companies.
- Museums and Galleries: The Museums and Galleries Exhibition tax relief is extended for a further two years until 31 March 2024.
- Theatre, Orchestra and Museums and Galleries Exhibition Relief: rates of relief have been increased to 31 March 2024.
- Capital Gains Tax deadline increased: The requirement to file calculations of capital gains due on certain residential property sales and pay any tax due within 30-days of completion – primarily on disposal of second homes and buy-to-let property – has been extended to 60-days. This affects all sales completed on or after 27 October 2021.
- Business rates relief extended: The business rates multipliers are frozen for a second year until 31 March 2023. The small business multiplier is set at 49.9p and the standard multiplier at 51.2p. Different rates apply in London and in Wales. The freezing of the multipliers will mean that your business rates will not increase in 2022-23. Eligible retail, hospitality and leisure properties will benefit from a 50% relief in their business rates for 2022-23, subject to a cap of £110,000 per business.
- National Living Wage: The basic NLW rate is increasing to £9.50 per hour from April 2022.