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Budget 2017 Summary

Today’s Budget announcement started at 12:30 and was the first Budget delivered by the Chancellor, Phillip Hammond. Apart from the economic predictions, several points will affect doctors and dentists. Here we summarise.


This article does not constitute advice. Professional advice should be taken prior to acting on any part of it.     


Key points of the Budget 2017 for Doctors & Dentists

Economic growth forecasts

It has been emerging over the past few months that the UK economy hasn’t performed as bad as expected following the EU Referendum.

To this extent, the Chancellor was able to give some good news regarding the new predictions on economic growth.

Figures now suggest:

 YEAR WAS NOW
2017 1.4% 2.%
2018 1.7% 1.6%
2019 2.1% 1.7%
2020 2.1% 1.9%
2021 2.0% 2.0%

However, political experts comment that the true effects of Brexit are yet to be felt.


Borrowing

Hopes of a surplus by the end of this decade have been abandoned.

Figures now suggest:

 YEAR WAS NOW
2017-2018 £59 billion £58.3 billion
2018-2019 £46.5 billion £40.8 billion
2019-2020 £22 billion £21.4 billion
2020-2021 £21 billion 20.6 billion
2021-2022 £17.2 billion 16.8 billion

Hammond indicated that this won’t be a reason to ease off on austerity measures, or spend more.


£435 million to help ease Business Rates (for some)

Understandably, Hammond needed to respond to the backlash following changes to business rates.

His solution, for now, is three-fold:

  1. A cap for small businesses so that rates rise by no more than £50 per month
  2. Pubs to get a £1,000 discount where their rateable value is under £100,000. This includes 90% of pubs.
  3. £300 million fund for local authorities to act with discretion to help local businesses.

More to clamp down on tax avoidance

Hammond has allocated £820 million in tax avoidance measures, including:

  • VAT on roaming telecoms outside the EU.
  • New financial penalties for professionals, i.e. accountants, who create schemes defeated by HMRC.
  • Measures to stop businesses converting capital losses into trading losses.

Claiming tax back from the self-employed

The Chancellor took some time to explain the need to further level the playing field between the self-employed and employed when it comes to the tax they pay.

It is likely this change will be seen by many as simply a further assault on entrepreneurialism.

National Insurance for self-employed will increase by 1% in 2018 and a further 1% in 2019.

The Treasury is expected to reap £145 million from this change.


Tax-free dividend allowance to reduce from 2018

The Chancellor announced a £3,000 drop in the tax-free dividend allowance that was introduced just last year.

The allowance will be just £2,000 from April 2018.

This could also be seen as a further attack on shareholders that currently gain tax advantages from taking dividends through a limited company, over a salary.


Personal tax allowance

Full Summary Guide to the Budget 2017

We are in the process of producing a full summary guide to the Budget 2017. This will be available to download in the coming days.

If you are on out mailing list you will be notified automatically and can download with just one click!


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