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HMRC is warning of scam attempts targeting self assessment taxpayers in the run up to the 31 January deadline.

Last year, concerned taxpayers reported nearly 150,000 scam referrals to HMRC.

Around half of all scam reports in the last year were fake tax rebate claims, says the tax authority.

There has been a 16.7% increase in all scam referrals to HMRC – 144,298 were received between November 2023 and October 2024, up from 123,596 in the previous 12-month period, it added.

If communication claiming to be from HMRC asks for personal information or offers a tax rebate, check the advice on GOV.UK to help identify if it is scam activity.

HMRC says it will never leave voicemails threatening legal action or arrest or ask for personal or financial information over text message – only fraudsters and criminals will do that.

Kelly Paterson, Chief Security Officer at HMRC, said:

‘With millions of people filing their self assessment return before January’s deadline, we’re warning everyone to be wary of emails promising tax refunds.

‘Being vigilant helps you spot potential scams. And reporting anything suspicious helps us stop criminal activity and to protect you and others who could have received similar bogus communication.

‘Our advice remains unchanged. Don’t rush into anything, take your time and check ‘HMRC scams advice’ on GOV.UK

Nearly half UK of adults have not written a will, nor are they currently in the process of doing so, according to research published by life insurer Canada Life.

Over a quarter said they do not have enough assets or wealth to warrant making a will, closely followed by 20% who believe they still have plenty of time to make one.

Additionally, the research found that 15% do not want to pay to write a will, while 14% believe their loved ones will inherit their assets automatically.

Stacey Love, Tax and Estate Planning Specialist at Canada Life, said:

‘Passing away without a will in place can place a significant burden on our loved ones. However, our research highlights that, up and down the country, people are not planning ahead or having conversations about the future.

‘No matter your age, writing a will should be a priority, even if you don’t think you have any real wealth to pass on. It’s also very important to have open, honest conversations with your loved ones about your inheritance plans, so they know what to expect.

‘Once your will is written, remember to review it every few years to make sure it remains accurate. Family circumstances can change over time, and so your will needs to reflect this.’

Almost 300,000 self assessment taxpayers filed their return in the first week of the new tax year, HMRC has revealed.

The early filers were almost 10 months ahead of the 31 January 2025 deadline.

Almost 70,000 people filed their return on the opening day of 6 April this year.

HMRC is encouraging people to file early and avoid the stress of last-minute filing.

The tax authority says early filing can also help with budgeting. A budget payment plan helps spread the cost of tax bills with weekly or monthly payments.

In addition, refunds of overpaid tax will be paid as soon as the return has been processed.

Myrtle Lloyd, HMRC’s Director General for Customer Services, said:

‘Filing your self assessment early means people can spend more time growing their business and doing the things they love, rather than worrying about their tax return.

‘You too can join the thousands of customers who have already done their tax return for the 2023-24 tax year by searching ‘self assessment’ on GOV.UK and get started today.’

UK taxpayers spent the equivalent of 800 years on hold to HMRC in 2022/23, according to a report published by the National Audit Office (NAO).

The report found that funding pressures, job cuts and a push to reduce costs by encouraging people to manage their tax affairs online had all led to a poor call-handling performance by HMRC.

The average time spent waiting on the phone to speak to an adviser in the 11 months to February 2024 was almost 23 minutes – well above the five minutes recorded in 2018/19.

Altogether taxpayers spent 7 million hours, or 798 years, on hold to HMRC in 2022/23, according to the report.

Customer service is in a ‘declining spiral’ at HMRC, which had not met its goals for responding to taxpayer correspondence or telephone calls for several years, the NAO added.

The government has recently announced an extra £51 million in funding to help HMRC improve its telephone helplines.

Gareth Davies, Head of the NAO, said:

‘HMRC’s telephone and correspondence services have been below its target service levels for too long.

‘While many of its digital services work well, they have not made enough of a difference to customers, some of whom have been caught in a declining spiral of service pressures and cuts. HMRC has also not achieved planned efficiencies.

‘HMRC must allow more time for these services to bed in and understand the difference they make before adjusting staffing levels.’

The next government must take a direct hand in rebuilding trust between HMRC and the self-employed, according to the Association of Independent Professionals and the Self-Employed (IPSE).

The call is part of IPSE’s manifesto for the General Election on 4 July.

Under its proposals, a Cabinet minister would be charged with directly overseeing the tax office. Taxpayers would also be offered more recourse when the department has acted carelessly or unfairly.

The manifesto also calls for the prevention of ‘obscenely’ long payment terms and the scrapping of the off-payroll rules.

IPSE also wants to see an end to shortfalls in support for self-employed parents and better incentives for people to adopt side hustles.

Derek Cribb, IPSE’s CEO, said:

‘The self-employed vote is very much up for grabs at this election – more than at any election in living memory.

‘The sector is bursting with potential to get more people working, plug skills gaps and grow the economy. But this potential is being squandered by the devastating impact of late payments, careless tax enforcement, and a lack of proactive policymaking catered to the millions of people who work for themselves.

‘At this election, the party that fully embraces the self-employed stands to gain their support. The proposals in our manifesto offers the parties the chance to do just that.’

HMRC is warning people to be wary of bogus tax refund offers following the self assessment deadline on 31 January.

The tax authority says that fraudsters could set their sights on self assessment taxpayers, with more than 11.5 million submitting a tax return by last month’s deadline.

HMRC warns that taxpayers who completed their tax return for the 2022/23 tax year by the 31 January deadline might be taken in by an email, phone call or text message offering a tax rebate.

These phishing scams are designed to use personal details for selling on to criminals, or to access people’s bank accounts, says HMRC.

The warning comes after HMRC responded to 207,800 referrals from the public of suspicious contact in the past year to January. This is a 14% increase from the 181,873 reported for the previous 12 months. More than 79,000 of those referrals offered bogus tax rebates.

Kelly Paterson, HMRC’s Chief Security Officer, said:

‘With the deadline for tax returns behind us, criminals will now try to trick people with fake offers of tax rebates.

‘Scammers will attempt to dupe people by email, phone or texts that mimic government messages to make them appear authentic.’

HMRC has published guidance on the Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) requirements for sole traders and landlords.

MTD for ITSA will require businesses and landlords with qualifying income to maintain digital records and update HMRC each quarter via compatible software.

In the guidance, HMRC stated that MTD for ITSA will be introduced in two phases:

• from April 2026 for those with qualifying income over £50,000

• from April 2027 for those with qualifying income over £30,000.

HMRC said that MTD will exploit ‘the opportunities offered by digitalisation to make it easier for everyone to get tax right’.

It said that digitalising government tax services helps to reduce the risk of unintentional customer errors; saves taxpayers time when they submit their tax returns; supports wider productivity and less time managing paperwork; and enables HMRC to better tailor its services to its customers.

In its latest guidance, HMRC estimates an average transitional cost of £115 for businesses mandated to use MTD for ITSA. Businesses within the £30,000 to £50,000 threshold are estimated to incur an average cost of £350 while those above £50,000 may incur an average cost of £285.

The government should raise the turnover threshold for VAT from £85,000 to £100,000, according to the Federation of Small Businesses (FSB).

The business group said that this would give firms stepping into the VAT-paying ring crucial breathing space. It would also be an incentive to grow their turnover without fear of having to charge customers an extra 20% overnight, the FSB added.

The FSB also suggested bringing in a smoothing mechanism to ease the transition for small firms, owner-managed companies and some of the self-employed who go just over the threshold.

At the moment, thousands of small firms keep their turnover just below the £85,000 threshold, according to the Office for Budget Responsibility (OBR).

The OBR said that hundreds of millions of pounds of potential economic activity could be lost due to this ‘bunching’ just below the threshold.

Tina McKenzie, FSB’s Policy Chair, said:

‘VAT compliance flattens small firms by stifling their growth and emptying their coffers. It’s crying out for a modern makeover to match today’s economic landscape.

‘We can’t let it squash the ambitions of small businesses, strivers, and budding entrepreneurs.

‘The flaws in our current system are glaringly obvious. We are at a breaking point – a drastic overhaul of VAT is needed.

‘Raising the threshold to reflect inflation, introducing a buffer to soften the blow for those just over the limit and demystifying the rules to save small business owners from a VAT-induced headache could unlock hundreds of millions in extra economic activity.’

As the use of cryptoassets continues to grow HMRC is warning people to check if they need to complete a self assessment tax return for the 2022/23 tax year to avoid potential penalties.

Anyone with cryptoassets should declare any income or gains above the tax-free allowance on a tax return.

Tax may be due when a person:

• receives cryptoassets from employment, if they are held as part of a trade, or are involved in crypto-related activities that generate an income

• sells or exchanges cryptoassets, including:

o selling cryptoassets for money

O exchanging one type of cryptoasset for another

O using cryptoassets to make purchases

O gifting cryptoassets to another person

O donating cryptoassets to charity.

Myrtle Lloyd, HMRC’s Director General for Customer Services, said:

‘People sometimes forget that information about crypto-related income and gains need to be included in their tax return. Some people affected may not have had to do a tax return before, so it is important people check.’

A large majority of UK business leaders plan to offer employees remote and hybrid working in the long-term, according to the Institute of Directors (IoD).

A survey conducted by the IoD found that 84% of business leaders polled plan to provide office-based staff members with some degree of remote working. The IoD’s survey was conducted between 13 and 30 September 2023 and received 710 responses.

13% of business leaders stated they plan to offer full remote working in the long-term, whilst 18% said they will allow employees to choose how they work.

Alexandra Hall-Chen, Principal Policy Adviser for Employment at the IoD, said:

‘Our research shows that, for a clear majority of businesses, remote and hybrid working are here to stay.

‘Against a backdrop of acute skills and labour shortages in the UK, flexible working is a valuable tool for businesses seeking to attract and retain talented staff.

‘Good flexible working policies can also support groups more likely to fall out of the workforce, such as parents and disabled people, to thrive in the workplace.

‘Anecdotally, we have found that some businesses are moving away from a model marked by full flexibility to a hybrid approach, due to a desire to bring staff together to facilitate innovation and team cohesion, but very few are removing their remote working offer entirely.’

Self assessment taxpayers must be on the lookout for scam texts, emails and phone calls from fraudsters, HMRC was warned.

HMRC has received more than 130,000 reports about tax scams in the past year, with 58,000 of those offering fake tax rebates.

With around 12 million people expected to submit a self assessment tax return for the 2022/23 tax year before the 31 January 2024 deadline, fraudsters will prey on taxpayers by impersonating HMRC.

The scams take different approaches. Some offer a rebate; others tell taxpayers that they need to update their tax details or threaten immediate arrest for tax evasion.

Myrtle Lloyd, HMRC’s Director General for Customer Services, said:

‘HMRC is reminding taxpayers to be wary of approaches by fraudsters in the run up to the self assessment deadline. Criminals are great pretenders who try and dupe people by sending emails, phone calls and texts which mimic government messages to make them appear authentic.

‘Unexpected contacts like these should set alarm bells ringing, so take your time and check HMRC scams advice on GOV.UK.’

The Institute of Directors (IoD) has urged the government to create an industrial strategy to help ‘define specific long-term priorities for the UK economy’.

A survey carried out by the IoD revealed that 88% of its members favour the development of an industrial strategy. Less than 10% of IoD members think economic growth should be generated by market forces.

The survey found that firms want an industrial strategy that focuses on reinforcing the UK’s capabilities as a centre of excellence for Research and Development (R&D) and green investment.

The survey found that 58% of firms believed that the strategy should also focus on the development of skills, and 57% would like it to champion developing infrastructure.

Dr Roger Barker, Director of Policy at the IoD, said:

‘The recent priority for UK government policy has been on regaining economic and financial stability, and in laying the groundwork for the return of economic growth.

‘However, this is not enough to sustain the competitiveness of UK business. Business leaders clearly see the value of a longer-term policy framework which places innovation at its core, and which enables innovations to be commercially exploited in the UK.

‘Experience suggests that UK policymakers are ill-suited to ‘picking winners’, either in terms of companies or sectors.’

Over 200 employers have been named by the government for failing to pay their lowest paid employees the minimum wage.

The 202 employers were found to have failed to pay their workers almost £5 million in a clear breach of the National Minimum Wage (NMW) law, leaving around 63,000 workers out of pocket.

Companies named and shamed range from major high street brands to small businesses and sole traders.

The businesses named have since paid back what they owe to their employees and have also been given financial penalties.

The employers named previously underpaid workers in the following ways:

• 39% of employers deducted pay from workers’ wages

• 39% of employers failed to pay workers correctly for their working time

• 21% of employers paid the incorrect apprenticeship rate.

Minister for Enterprise, Markets and Small Business, Kevin Hollinrake, said:

‘Paying the legal minimum wage is non-negotiable and all businesses, whatever their size, should know better than to short-change hard-working staff.

‘Most businesses do the right thing and look after their employees, but we’re sending a clear message to the minority who ignore the law: pay your staff properly or you’ll face the consequences.’

HMRC is planning to close its self assessment tax helpline for three months over the summer to focus call centre resources on dealing with other problem calls.

All calls to the helpline will be redirected to digital services over the period to give HMRC time to deal with other more urgent phone enquiries.

The helpline will be closed for three months from Monday 12 June until Monday 4 September.

During this time HMRC said it will ‘trial directing self assessment queries from the helpline to the department’s digital services, including its online guidance, digital assistant and webchat’.

HMRC will increase the number of advisers available on webchat, the online service helpline and the extra support team helpline.

Angela MacDonald, Deputy CEO and Second Permanent Secretary at HMRC, said:

‘We continually review our services to see how they can best serve the public and we are taking steps to improve them.’ We are experienced in self assessment matters and dealing with HMRC. Please contact us if you have any queries.

The end of the Energy Bill Relief Scheme (EBRS) on 1 April could threaten the future of hundreds of thousands of small firms, according to research by the Federation of Small Businesses (FSB).

The Energy Bill Discount Scheme (EBDS) offers a far lower level of support for small businesses.

Although market prices have stabilised for those fixing their contracts now or those who are on variable tariffs, businesses that fixed last year will see huge increases as they are locked into a high price before the government’s relief.

A business paying £24,528 per year for energy under the old government support scheme will now pay £82,539 under the new scheme.

The FSB is calling for small firms to be allowed to renegotiate their energy contracts that were fixed last year. It is also calling for additional support for businesses to become more energy efficient.

Tina McKenzie, Policy Chair at the FSB, said:

‘The jump in energy bills on April Fool’s Day won’t be a laughing matter but will be a shock to hundreds of thousands of small businesses, who signed up to fixed contracts when the government discount was guaranteed under EBRS.

‘There’s much that could and should be done rather than leaving small firms high and dry. Allowing the most vulnerable small businesses to renegotiate or ‘blend and extend’ their energy contracts to better reflect lower wholesale energy prices is the least the government and energy suppliers could do.’

The Treasury and the Bank of England (BoE) have suggested that a state-backed ‘digital pound’ is likely to be launched this decade.

Both the Treasury and the Bank said that the public should have access to ‘safe’ digital money that can be used easily.

A central bank digital currency (CBDC) would use similar technology to cryptocurrencies, but the digital pound would be ‘less volatile’, according to the BoE.

Andrew Bailey, Governor of the Bank of England, said:

‘As the world around us and the way we pay for things becomes more digitalised, the case for a digital pound in the future continues to grow. A digital pound would provide a new way to pay, help businesses, maintain trust in money and better protect financial stability.

‘However, there are a number of implications which our technical work will need to carefully consider. This consultation and the further work the Bank will now do will be the foundation for what would be a profound decision for the country on the way we use money.’

A consultation has been launched on how the CBDC would work.

The government has launched a consultation on simplifying the UK’s research and development (R&D) tax relief system, driving innovation and growing the economy.

The consultation runs to 13 March 2023 and sets out proposals on how a single scheme could be designed and implemented.

This would replace the two R&D tax relief schemes currently in place – the Research and Development Expenditure Credit scheme and the small and medium enterprises R&D relief.

This is part of the government’s ongoing R&D tax reliefs review, and follows changes announced at Autumn Statement 2022 where the generosities of the two R&D tax schemes were broadly aligned.

Victoria Atkins MP, Financial Secretary to the Treasury, said:

‘We are focussed on growing the economy – with thriving businesses bringing more jobs, higher pay and more tax revenue to fund our precious public services.

‘Getting R&D tax relief right and fit for the future sits at the heart of making sure the UK remains a competitive location for cutting edge research – helping new firms grow.

‘I welcome views on the option to simplify the scheme, especially from those who have experience of the existing tax reliefs.’

The Mortgage Guarantee Scheme will be extended by a year to the end of December 2023, helping people with 5% deposits on to the property ladder, the UK government has announced.

Under the scheme, the government offers lenders the financial guarantees they need to provide mortgages that cover the other 95%, subject to the usual affordability checks, on a house worth up to £600,000.

Launched in April 2021, the scheme has already helped over 24,000 households. It was originally planned to close at the end of this year but will now be extended until the end of 2023.

Chief Secretary to the Treasury, John Glen MP, said:

‘For hard-working families facing today’s challenging economic conditions, it’s right that we continue to help them secure their first home or move into their dream house.

‘Extending this scheme means thousands more have the chance to benefit, and supports the market as we navigate through these difficult times.’

The Treasury has announced that Making Tax Digital for income tax self assessment (MTD for ITSA) will be delayed for two more years until April 2026.

MTD for ITSA was due to take effect from April 2024 and would have required all self-employed individuals and landlords with income over £10,000 to report earnings quarterly through the MTD for ITSA system.

However, in a Written Statement, Victoria Atkins, Financial Secretary to the Treasury, confirmed that the mandation of MTD for ITSA will now be introduced from April 2026. Businesses, self-employed individuals and landlords with income over £50,000 will be required to join first. From April 2027, those with income over £30,000 will be mandated to join, the Treasury said.

Ms Atkins said:

‘The government understands businesses and self-employed individuals are currently facing a challenging economic environment, and that the transition to MTD for ITSA represents a significant change for taxpayers, their agents and for HMRC.

‘That means it is right to take the time needed to work together to maximise those benefits of MTD for small business by implementing gradually.’

The Treasury said that the government now intends to review the needs of smaller businesses in regard to MTD for ITSA, and will consider how the initiative can be shaped to meet their needs.

Once the review is finalised, the government will outline plans for any further mandation of MTD for ITSA.

The Treasury also stated that the government will not extend MTD for ITSA to general partnerships in 2025, saying that the government ‘remains committed to introducing MTD for ITSA for partnerships at a later date’.

The UK’s tax burden will rise after Chancellor Jeremy Hunt reduced the threshold on the top rate of tax and announced freezes on other taxes in the Autumn Statement.

The threshold for the top 45% additional rate of income tax was cut to £125,140 from £150,000.

The government is also fixing other personal tax thresholds within income tax, NICs and inheritance tax for an additional two years, until April 2028.

The Dividend Allowance will be reduced from £2,000 to £1,000 next year and £500 from April 2024.

In addition, the capital gains tax exemption will be reduced from £12,300 to £6,000 next year and then to £3,000 from April 2024.

As energy prices continue to drive inflation, the Chancellor confirmed that the Energy Price Guarantee will be extended for a year from April 2023. However, the level at which typical bills are capped will increase to £3,000 a year from £2,500.

The windfall tax on the profits of oil and gas firms was increased from 25% to 35% and extended until March 2028.

The Chancellor also announced a £13.6 billion package of support for business rates payers in England. To protect businesses from rising inflation, the multiplier will be frozen in 2023/24, while relief for 230,000 businesses in the retail, hospitality and leisure sectors was also increased from 50% to 75% next year.

Mr Hunt also confirmed the National Living Wage (NLW) will rise from £9.50 to £10.42 an hour, while the triple lock on state pensions was protected.

The Chancellor said:

‘There is a global energy crisis, a global inflation crisis and a global economic crisis. But today with this plan for stability, growth and public services, we will face into the storm. Because of the difficult decisions we take in our plan, we strengthen our public finances, bring down inflation and protect jobs.’

We are helping business owners review their dividend/ remuneration policies, with dividend allowance being halved from April 2023 and again the following year ( 2023-24-£1000.00 and 2024-25-£500.00).

With the increase in NIC thresholds too, everything should be reviewed to ensure maximum tax-efficiencies, as your business moves forward.

Feel free to call, if you would like to discuss this.

TEL-01527 433111

Key Announcements from the autumn statement.

• The main income tax allowances and thresholds, the main national insurance thresholds and the IHT nil rate bands will remain frozen at their current levels for an extra two years until April 2028

• The threshold for the 45% additional rate of income tax will reduce from £150,000 to £125,140 from April 2023

• The dividend allowance will be halved from April 2023 and again the following year ( 2023-24-£1000.00 and 2024-25-£500.00).

• The capital gains annual exempt amount will be cut from £12,300 to £6,000 for 2023/24 and halved to £3,000 from April 2024

• From April 2023 the energy price guarantee will be adjusted upwards, costing typical households an additional £500 from the current position

• State pensions will increase under the ‘triple lock’ in line with the 10.1% September CPI inflation figure, alongside universal credit and certain other benefits

• Business rates will be updated with additional targeted support over the next five years

• Electric cars will come into the tax orbit for road tax from April 2025

HMRC has reminded taxpayers that they are now less than 100 days until the deadline for self assessment online return submission.

Self assessment taxpayers have until 31 January 2023 to submit their online return for the 2021/22 tax year.

According to HMRC, more than 66,000 taxpayers beat the clock and filed their tax return on 6 April – the first day of the new tax year.

HMRC is now encouraging others to complete their return as soon as they can so they know what they owe and can budget to make the payment by 31 January 2023. This also means that if a repayment is due, it can be claimed back sooner.

Last year, more than 95% of taxpayers filed online and those who submit their returns early still have until 31 January 2023 to pay.

Speaking on 24 October, Myrtle Lloyd, HMRC’s Director General for Customer Services, said:

‘With 100 days to go until the online deadline, there’s still time to complete your tax return, to budget and look into the range of payment options if you need to.’

The UK’s new Prime Minister Rishi Sunak must restore confidence in the country’s economy, say business groups.

Mr Sunak will have to deal with a range of issues stemming from inflation and the cost-of-living crisis.

Business groups say he will need to set out plans to deal with soaring energy bills, labour shortages, spiralling inflation, and climbing interest rates.

Shevaun Haviland, Director General of the British Chambers of Commerce (BCC), said:

‘The new Prime Minister must be a steady hand on the tiller to see the economy through the challenging conditions ahead.

We cannot afford to see any more flip-flopping on policies – the UK’s businesses need a sustainable, long-term economic plan they can believe in.

We need a clear long-term vision of how the new Prime Minister will deal with the challenges ahead and create the business conditions that allow firms, and the communities that rely on them, to thrive.’

The BCC says business need more certainty on the energy support package for businesses and how the system will work from April.

In addition, it says the government must set out a strategy to boost international trade and exports.

Tony Danker, Director-General at the Confederation of British Industry, said:

‘The new Prime Minister can lose no time in easing the impact of market turmoil on households and firms, and helping to restore fiscal credibility.’

Chancellor of the Exchequer Jeremy Hunt has delayed the announcement of the government’s economic plan until 17 November.

The Medium-Term Fiscal Plan was due to be delivered by the Chancellor in the Commons on 31 October, along with a forecast from the Office for Budget Responsibility.

This had been brought forward because of the market turmoil that followed September’s Mini Budget.

But it will now be put back by more than two weeks and be turned into a full Autumn Statement – expanding its remit and providing longer term plans.

The delay followed the reversals of most of the measures announced in the recent Mini Budget.

Mr Hunt announced that the following tax policies will no longer be taken forward:

• cutting the basic rate of income tax to 19% from April 2023. The basic rate of income tax will remain at 20% indefinitely.

• cutting dividend tax by 1.25 percentage points from April 2023. The 1.25 percentage point increase, which took effect in April 2022, will remain in place.

• repealing the 2017 and 2021 reforms to the off-payroll working rules (also known as IR35) from April 2023. The reforms will remain in place.

The changes follow decisions not to proceed with proposals to remove the additional rate of income tax and to cancel the planned rise in the corporation tax rate.

Mr Hunt said:

‘Our number one priority is economic stability and restoring confidence that the United Kingdom is a country that pays its way. But it is also extremely important the statement is based on the most accurate possible economic forecasts and forecasts of public finances.’

Chancellor Kwasi Kwarteng used the 2022 Mini Budget to announce a series of tax cuts for businesses and individuals.

The Chancellor confirmed that the 1.25% rise in national insurance contributions (NICs) that came in this year will be reversed from 6 November, while the Health and Social Care Levy has been cancelled.

The planned rise in corporation tax to 25% will be scrapped and the rate maintained at the current 19%. The basic rate of income tax will be cut to 19p in April 2023, a year ahead of schedule.

Additionally, the level at which homebuyers will start to pay Stamp Duty Land Tax (SDLT) in England and Northern Ireland has been doubled from £125,000 to £250,000. First-time homebuyers will pay no SDLT on homes worth up to £425,000, up from the previous price of £300,000.

For businesses, Investment Zones will be established across the UK that benefit from lower taxes and liberalised planning frameworks to encourage business investment.

The cap on bankers’ bonuses, which limited rewards to twice the salary level, will be axed.

The Chancellor also committed to repealing the off-payroll legislation. The IR35 reforms, which rolled into the public and private sectors in 2017 and 2021 respectively, will no longer apply from April 2023 and responsibility for determining employment status where a personal service company is used will return to the worker.

Mr Kwarteng said:

‘Growth is not as high as it needs to be, which has made it harder to pay for public services, requiring taxes to rise. This cycle of stagnation has led to the tax burden being forecast to reach the highest levels since the late 1940s.

‘We are determined to break that cycle. We need a new approach for a new era focused on growth.’

The government has abandoned its plan to abolish the 45% top rate of income tax due to the negative reaction it has received.

Chancellor Kwasi Kwarteng first announced the policy in the Mini Budget on 23 September.

He has now confirmed that it will not go ahead in a statement on the social media platform Twitter. It has not yet been confirmed whether the same reversal applies to the top rate of income tax on dividends.

In a tweet, Mr Kwarteng said:

‘From supporting British business to lowering the tax burden for the lowest paid, our Growth Plan sets out a new approach to build a more prosperous economy.

‘However, it is clear that the abolition of the 45p tax rate has become a distraction from our overriding mission to tackle the challenges facing our country.

‘As a result, I’m announcing we are not proceeding with the abolition of the 45p tax rate. We get it, and we have listened.

‘This will allow us to focus on delivering the major parts of our growth package.’

More than £20 billion could be added to the UK economy in the future from the number of additional businesses created during the pandemic, according to research carried out by the Confederation of British Industry (CBI).

Around 800,000 companies were registered in the first year of the pandemic, a 22% increase compared with the previous year. Only 13% of these start-ups cited regulation as a challenge when starting their business.

However, access to finance was a key concern for many burgeoning business leaders, with 55% highlighting this post-2020, compared with 42% pre-Covid.

The research also found that businesses born during the pandemic are 20% more likely to embrace sustainability than firms established prior to 2020.

Tony Danker, Director General of the CBI, said:

‘Pandemic-born businesses – led by ambitious, resilient entrepreneurs – have innovated in so many ways, and at such speed, giving me great sense of optimism. It’s crucial we give these leaders the support they need to grow and succeed.

‘Rising energy prices, supply chain challenges, an uncertain economic outlook and cost-of-living crisis mean we’ve some testing months, and possibly years, ahead. For start-ups which count their experience in months, not years, that environment is even tougher.

‘That said, even if the cost of doing business is rising, the cost of starting a business shouldn’t. The UK needs the ideas and ingenuity of entrepreneurs to help us grow.’

The level at which people start paying national insurance rose from £9,880 to £12,570 from 6 July.

According to the government, 30 million people across the UK will benefit from this tax cut. It says the increase will lift 2.2 million people out of paying any personal tax.

The threshold change means that 70% of UK workers will pay less national insurance, even after accounting for the Health and Social Care Levy, the government added.

Prime Minister Boris Johnson said:

‘We know it’s tough for many families across the UK, but we want you to know that this government is on your side.

‘Today’s tax cut means around 70% of British workers will pay less national insurance – even after accounting for the Health and Social Care Levy that is funding the biggest catch-up programme in NHS history and putting an end to spiralling social care costs.

‘So whether you are a receptionist, work in hospitality or are a delivery driver, this tax cut is likely to make you and your family better off.’

Four out of five employers stated that they were immediately impacted by the increase in national insurance contributions (NICs), according to research by the British Chambers of Commerce (BCC).

The BCC surveyed more than 1,100 UK employers and found that the NICs increase has caused negative impacts to 81% of businesses.

Firms said the rise in employer NICs from 13.8% to 15.05% has increased staffing costs, forced some to put up their prices and meant they would be limiting their investment.

As part of its call for an Emergency Budget, the BCC said the rise should be immediately reversed for at least a year, as firms battle surging costs on multiple fronts.

The BCC is calling for action to give businesses a chance to keep a lid on rising prices, boost productivity and ease cost pressures.

Hannah Essex, Co-Executive Director at the BCC, said:

‘Businesses are telling us that the rise in NICs has been a body blow as they try to get back on their feet. With firms’ profits also taking a further hit, after two years of the pandemic, it is no surprise that their investment intentions are also weakening.

‘But it is not too late to change tack and push the increase back until firms are in a better place to take on the extra burden. The costs crises facing firms and people in the street are two sides of the same coin. If we can ease the pressure on businesses, then they can keep a lid on the price rises.’