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In his Spring Statement the Chancellor’s main focus was on measures to help those hardest hit by the rising cost of living.

While he continued with his earlier pledge to raise the rate of National Insurance and dividends by 1.25% percentage points to help with social care reforms, he countered some of its impact by raising the threshold at which NI becomes payable. And in a surprise move he announced that there will be 1% cut to the basic rate of income tax from April 2024.

Read our summary of the key points from today's Statement and for a complete look at the tax rates, bands and allowances which will apply from April, see our 2022/23 Tax Tables.

Pensions and savings

• Pension tax relief - There were no changes to pension tax relief in the Chancellor’s Budget.
• ISAs - The 2022/23 annual subscription limits for adult and junior ISAs will remain at £20,000 and £9,000 respectively.

Income tax

• Earnings and savings - In England, Wales and Northern Ireland, the basic rate of income tax will fall from 20% to 19% from April 2024. This will apply to both non-savings and savings income. The trust rate will also reduce to 19% for the first £1,000 of income (the standard rate band). The Scottish Government will decide on the rates in Scotland from 2024, but will be supported by additional funding.
• Dividends - It was confirmed that the rate of tax for dividends will increase by 1.25 percentage points as part of the measures to fund social care reforms. This will mean the new dividends rates for individuals will be 8.75% (basic), 33.75% (higher) and 39.35% (additional). The rate for trustees will be 39.35% on amounts in excess of the trust’s standard rate band.
  
  Whilst there is to be an increase in NI thresholds to offset some of the impact of the rate increase to employees, there was no corresponding increase to the dividend allowance to help business owners
• Allowances and thresholds - The personal allowance and basic rate band will be frozen at £12,570 and £37,700 respectively until 2025/26. This means that the higher rate tax threshold will remain at £50,270 for those entitled to a full personal allowance.
• Scotland - Aside from any changes from 2024, the Scottish Budget confirmed that the Scottish Starter and Basic Rate bands have been increased by inflation whilst all other bands are to remain frozen.
  
  The new bands for earned income will be:
  
  

  Above £150,000	46%
  Band	Rate
  Over £12,570 - £14,732	19%
  Over £14,732 - £25,688	20%
  Over £25,688 - £43,662	21%
  Over £43,662 - £150,000	41%

National Insurance

The thresholds at which individuals will start to pay National Insurance (NI) will be brought in line with the annual personal allowance of £12,570. This will happen from July 2022, and applies to both employees and the self-employed.

From April the self-employed will not have to pay class 2 flat rate NI contributions if their profits are below £9,880, with the lower profits limit rising to £12,570 from July.

The increase to NI to help pay for social care reforms will go ahead as planned. This will see an extra 1.25% added to the rates of NI for 2022/23 for employees, employers and the self-employed. It's intended that the 1.25% rise will become a separate standalone levy from 2023/24.

Capital Gains Tax

• No further changes announced.

Inheritance tax

• No further changes announced.

Corporation tax

• No further changes announced.