The Chancellor of the Exchequer, Rishi Sunak, delivered the Spring Forecast Statement to Parliament on Wednesday 23rd March 2022.
Our team has prepared a summary of the key announcements including comment on how they affect both individuals and businesses across the UK. Here’s what you need to know:
The threshold for National Insurance (NI) contributions will increase by £3,000 from July
o This means you won’t pay NI until you’re earning £12,570 (aligning it with the current tax-free personal allowance)
Basic rate income tax planned to drop from 20% to 19% in April 2024
o Scotland and Wales have the right to set their own rates of income tax, so the rate of tax you pay may depend on where you live in the UK. This could have some impact on the tax relief you get on pension contributions
o For the 2022-23 tax year the basic rate of income tax will remain at 20% on earnings between £12,570 and £50,270
Fuel duty was cut by 5 pence per litre, among other measures aimed at easing the pressure on household budgets
There were no major changes announced in regard to pensions, so savers can plan for the new tax year with confidence
The State Pension will rise by 3.1% from April 2022, as confirmed in the Autumn 2021 Budget
o This will affect you whether you’re eligible for the new flat-rate State Pension, which was introduced in April 2016, or the older basic State Pension
o From April 2022 those qualifying for a full new State Pension will receive £185.15 a week (up from £179.60). And those who reached State Pension age before April 2016, who are on the older basic State Pension, will now receive £141.85 – up from £137.60.
Guide To Spring 2022 Forecast Statement