Income tax

Income tax rates

The government had previously announced that there would be a cut in the basic rate of income tax, from 20% to 19%, from April 2024. This was to be accelerated so that it took effect from April 2023. However, whilst the government aims to proceed with the cut in due course, this will only take place when economic conditions allow and a change is affordable. The basic rate of income tax will therefore remain at 20% indefinitely

At the Mini Budget on 23 September the government announced a plan to abolish the 45% additional rate of income tax from April 2023. However, it was announced on 3 October that the government would not proceed with the abolition of the 45p tax rate.

Dividends

The government has also confirmed that, from April 2023, the 1.25% proposed reduction in rates of taxation will not proceed, meaning that the rates will stay as follows:

  • the dividend ordinary rate - 8.75%
  • the dividend upper rate - 33.75%
  • the dividend additional rate - 39.35%.

As corporation tax due on directors' overdrawn loan accounts is paid at the dividend upper rate, this will also remain at 33.75%.

These changes will apply in Scotland and Wales as the rules on dividends apply to the whole of the UK.

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Our Offices

Rochdale
CCM | Carter, Collins & Myer, Chichester House, 2 Chichester Street, Rochdale, Lancashire OL16 2AX

01706 860255

Ashton
CCM Ashton, Shaw House, 1 Shaw St, Ashton-under-Lyne OL6 6QJ

0161 339 5689

Bolton
CCM Green & Co, Hamill House, 112-116 Chorley New Rd, Bolton BL1 4DH

01204 497247

Carlisle
CCM Carlisle Ltd, Solway House Business Centre, Parkhouse Road, Kingstown, Carlisle CA6 4BY

01228 830803


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The term ‘Board Director’ is used to refer to a statutory director and principal of Carter Collins & Myer Ltd as registered at Companies House. Any other designations that include the term ‘Partner’ or ‘Director’ are not registered statutory directors or principals and are marketing terms used to describe representatives of the company.

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