A Break Down of the 2023 Spring Budget: Key Highlights and Implications

The Chancellor of the Exchequer, Jeremy Hunt, has announced a range of new measures in his Spring ‘growth’ Budget.

One of the biggest shake ups was the increase in the tax-free allowance for pension contributions rising from £40,000 to £60,000 and abolishing the lifetime allowance that was previously set at £1.073m.

This means that you can contribute up to £60,000 per year into your pension without being hit with additional taxes and that there is no limit to how much you save for retirement.

Something that has not been big news but will make a difference to many large companies in the UK is the 100% full expensing of capital allowances on main rate assets and 50% on special rate assets from April 2023. This will replace the 130% super deduction that was put in place to boost growth following the pandemic.

Moreover, in an attempt to ensure that people are not at a disadvantage when it comes to returning to work after having children, the UK government has pledged to provide 30 hours per week of free childcare to all children over 9 months old by September 2025.

It has also been confirmed that the personal tax allowance will remain at £12,570 per year and corporation tax will increase to 25% for profits over £250,000.