2022 fiscal event

[Rufus Stone]

Full announcement tomorrow of course, but as seem the political habit these days items are being confirmed in advance.

The reversal of the 1.25% NI increase will be effective from 6th November 2022. It appears to apply to employer and employee rates. Don't know about the dividend tax yet.

[Murph7355]

I was hoping they'd kick the bullst leaks/early views into touch and have a bit more faith in their ability to do policy they believe in and could stand behind.

Forlorn hope (which was always small looking at those on the front bench).

Has a govt ever wasted a majority the size of this one before, in such spectacular style?

[bitchstewie]

Come on Murph what happened to that infamous balance you always used to bring to the table?

[Boringvolvodriver]

Rufus Stone said:

Full announcement tomorrow of course, but as seem the political habit these days items are being confirmed in advance.

The reversal of the 1.25% NI increase will be effective from 6th November 2022. It appears to apply to employer and employee rates. Don't know about the dividend tax yet.

Wasn’t that 2.5% supposed to be for social care and the the NHS?

How will the new health Secretary manage to improve the services that she is promising………..

Quick, let’s get the money printing presses going faster shall we?

[ED209]

I wouldn’t mind a slight increase in the 40% income tax threshold and the earrings threshold where you start to lose child benefit

[DeejRC]

Isn’t Liz just doing what she said she would in the leadership election ?

[Scrimpton]

DeejRC said:

Isn’t Liz just doing what she said she would in the leadership election ?

Yep. At least Badenoch seemed to have some actual ideas but I guess we get to watch Truss blunder about achieving nothing for a couple of years before Starmer has a crack. Great.

[Murph7355]

bhstewie said:

Come on Murph what happened to that infamous balance you always used to bring to the table?

I thought I'd get in first with the whining so you could provide the balance.

(You will note that my mirth on our financial position has been in force for some time. As has my dissing of govt's ability to communicate properly).

[Rufus Stone]

Murph7355 said:

I was hoping they'd kick the bullst leaks/early views into touch and have a bit more faith in their ability to do policy they believe in and could stand behind.

Forlorn hope (which was always small looking at those on the front bench).

Has a govt ever wasted a majority the size of this one before, in such spectacular style?

Well this isn't a testing the water leak, it's a confirmation of what will be announced today. Up to now the Truss government has been great at making the headline but the detail appears scant or follows several days later. I wonder of they are going to reverse the NI threshold increase Sunak introduced, ie put us back to the 2021 levels.

I for one will be very annoyed if they don't reverse the dividend tax increase in conjunction with the NI increase reversal.

Edited by Rufus Stone on Friday 23 September 06:04

[Rufus Stone]

Just received this:

Update from HMRC


Dear customer,
Today the government announced in-year reductions to National Insurance rates and the cancellation of the Health and Social Care Levy as a separate tax. We wanted to let you know these changes at the earliest opportunity so that you can prepare and take the necessary actions. The key changes are:
• National Insurance contribution (NIC) rates will be cut by 1.25 percentage points for employees, employers and the self-employed, effectively reversing the uplift introduced in April 2022 for the rest of the tax year. This cut will take effect from 6‌‌‌‌‌‌ ‌‌November 2022 and it will cover Class 1 (both employee and employer), Class 1A , Class 1B and Class 4 (self-employed) NICs
• the ring-fenced Health and Social Care Levy of 1.25% due to be introduced from April 2023 will also not go ahead
We have previously asked employers and software developers to include a temporary generic message on payslips for the tax year (2022 to 2023) to explain the reason for the NICs uplift. This message will not be applicable from 6‌‌‌‌‌‌ ‌‌November 2022, and it should be removed from payslips with effect from this date.
The full detail on all of these changes will be published by HMRC on GOV‌‌‌‌‌‌‌.UK in due course, but we wanted to email you as soon as possible, so that you can make the appropriate changes in order to be ready for November 2022 payroll. Please be assured that if you use HMRC Basic PAYE tools this software will be automatically updated to take account of these changes.
We realise the timeline for this is tight and some employers may not be able to implement the changes in time. HMRC will be directing employees to their employers to correct any overpaid NICs in the first instance.
We have also written to Payroll Software Developers to make them aware of these changes and asked them to take the relevant actions. You should therefore contact your software developer initially with any queries.
Please note that these changes are subject to Parliamentary approval.
Thank you for your co-operation.
HM Revenue and Customs

[Rufus Stone]

Here's the Government announcement:

https://www.gov.uk/government/news/national-insura...

Looks like the increase in the Dividend tax will be reversed but only from 06/04/2023.

[JagLover]

Rufus Stone said:

Just received this:

Update from HMRC


Dear customer,
Today the government announced in-year reductions to National Insurance rates and the cancellation of the Health and Social Care Levy as a separate tax. We wanted to let you know these changes at the earliest opportunity so that you can prepare and take the necessary actions. The key changes are:
• National Insurance contribution (NIC) rates will be cut by 1.25 percentage points for employees, employers and the self-employed, effectively reversing the uplift introduced in April 2022 for the rest of the tax year. This cut will take effect from 6?????? ??November 2022 and it will cover Class 1 (both employee and employer), Class 1A , Class 1B and Class 4 (self-employed) NICs
• the ring-fenced Health and Social Care Levy of 1.25% due to be introduced from April 2023 will also not go ahead
We have previously asked employers and software developers to include a temporary generic message on payslips for the tax year (2022 to 2023) to explain the reason for the NICs uplift. This message will not be applicable from 6?????? ??November 2022, and it should be removed from payslips with effect from this date.
The full detail on all of these changes will be published by HMRC on GOV???????.UK in due course, but we wanted to email you as soon as possible, so that you can make the appropriate changes in order to be ready for November 2022 payroll. Please be assured that if you use HMRC Basic PAYE tools this software will be automatically updated to take account of these changes.
We realise the timeline for this is tight and some employers may not be able to implement the changes in time. HMRC will be directing employees to their employers to correct any overpaid NICs in the first instance.
We have also written to Payroll Software Developers to make them aware of these changes and asked them to take the relevant actions. You should therefore contact your software developer initially with any queries.
Please note that these changes are subject to Parliamentary approval.
Thank you for your co-operation.
HM Revenue and Customs

Gives the payroll software providers extra time to update their systems so in this case looks sensible to send out in advance of the official announcement.

[Rob_125]

I'm hardly a socialist (and am in the higher level tax bracket), however the NI backtrack seems a little off. It will affect the poorest the least.

No really sure saving £400 will makena huge difference, and regardless of that, its largely offset by salary sacrifice schemes. (Shares/pension/c2w)

Surely a VAT reduction would have been a better tool to use?

[JagLover]

Rob_125 said:

I'm hardly a socialist (and am in the higher level tax bracket), however the NI backtrack seems a little off. It will affect the poorest the least.

I suppose the question is more should it have gone ahead in the first place with the UK going into recession?. All they are doing is abandoning a rise put in place in a April, so not much of a tax cut.

[Rufus Stone]

Rob_125 said:

I'm hardly a socialist (and am in the higher level tax bracket), however the NI backtrack seems a little off. It will affect the poorest the least.

No really sure saving £400 will makena huge difference, and regardless of that, its largely offset by salary sacrifice schemes. (Shares/pension/c2w)

Surely a VAT reduction would have been a better tool to use?

You could also say the increase affected the poorest the least.

A VAT reduction would also benefit the poorest the least as they have little money to spend on 'luxuries'. I would certainly welcome 5% off a big fk off telly I am thinking of buying.

[anonymous-user]

ED209 said:

I wouldn’t mind a slight increase in the 40% income tax threshold and the earrings threshold where you start to lose child benefit

The chances of a move from Claire’s Accessories to Tiffany is slim.

[menousername]

Boringvolvodriver said:

Wasn’t that 2.5% supposed to be for social care and the the NHS?

How will the new health Secretary manage to improve the services that she is promising………..

Quick, let’s get the money printing presses going faster shall we?

This is what I am wondering. Believe NHS staff have just been given a pay rise too. Assume there will be some cuts elsewhere announced quietly in time. Either that or they are going all-in on trying to stoke growth and increase the tax take as a result.

[Eric Mc]

I'd love the ill thought through Making Tax Digital (MTD) project to be axed - or postponed indefinitely.

[panholio]

BBC live ticker thing suggesting an income tax cut could be a "rabbit".

[Rufus Stone]

panholio said:

BBC live ticker thing suggesting an income tax cut could be a "rabbit".

What does that mean?