Spring Budget 2017: Paving the way to a global future?

Chancellor Philip Hammond delivered a rather bland budget today, albeit in a jovial manner. The last Spring Budget ever to be delivered, (though we were well reminded that after the last ‘last Spring Budget’ the Chancellor was sacked 10 weeks later!) there were no real surprises and no real changes. Described as ‘complacent’ by Jeremy Corbyn, it did feel deflated and a little contradictory.


The headlines for business are the changes in the Dividend Allowance and to Class 4 NICs - affecting both Ltd company directors and the self employed.  Though the planned reduction in Corporation tax is still going ahead, from the current 20% to 17% by 2020, this hardly supports Mr Hammond’s statement that he wants “the UK to be the best place in the world to start and grow a business”.

Not deviating from the script, fairness and deficit reduction was at the heart of this budget.  “A stronger, fairer, more global Britain” that supports its citizens is the end goal - though many of the big issues like policing, environment and housing were largely ignored.  Announcements from the Autumn Statement still carried, but there were no real new measures introduced.


Changes to the Flat Rate Scheme with the new 16.5% trade sector and the IR35 measures in the public sector are still going ahead from April 2017 - many are still scrambling to prepare for these, with little support from the government.  (read our recent blogs on these here:



The biggest area of focus was the potential skills gap and the lack of training/education the youth of today are leaving school with.  A new branding of technical learning was announced - T-levels - to make the education path and employer’s needs clearer.


  • The UK economy grew faster than every advanced economy apart from Germany in 2016
  • Unemployment is at an 11 year low, with employment at 74.6%.  A higher proportion of women are in work than ever.
  • Low productivity is still an issue
  • Forecast growth increased to 2% from 1.4% this year, then 1.6% in 2018 rising to 2% in 2021
  • Inflation forecast to be 2.4% this year, falling to 2% in 2019
  • Borrowing’s set to be lower than forecast - £51.7bn for 2016/17 (2.6% GDP), falling to £16.8bn in 2021/22 (0.7% GDP)
  • Britain’s debt is now 1.7 trillion pounds


  • CT reductions previously announced still stand, from the current 20% to 19% after April 2017, to 17% in 2020
  • The tax free Dividend Allowance reduced from £5,000 to £2,000 in 2018 (so changes next tax year)
  • Class 2 NICs are still being abolished in 2018, but class 4 NICs will be increased by 1% then (so next tax year again) and a further 1% in 2019 to 11% of turnover. The increases are due to parity gained on the state pension for self employed persons recently.  The government will look at the differences in parental benefits in the summer.
  • Making Tax Digital will be delayed by one year for those who have a turnover of less than £83k/year (the VAT registration threshold)
  • Big hints that the ‘digital economy’ will be taxed - in response to outcries at Business Rates
  • National Living Wage increasing to £7.50 in April as planned
  • R&D tax credits will be reviewed to ease administration
  • Small Business Rate Relief will remain at 100% from 1st April, as previously announced.  For those losing SBRR a cap will be put on of £50/month increase this year, with a transitional relief in place in future. Pubs receive a £1,000 discount for 2017, for those with a rateable value of <£100k. Local authorities will have a £300m fund to deal with difficult cases on a discretionary basis.
  • Vehicle Excise Duty (for hauliers)and HGV Road User Levy frozen for a year


  • Personal tax free allowance for 2017/18 will be £11,500 as planned
  • Investors with a significant portfolio will be affected by the change to the Dividend Allowance in 2018
  • Annual ISA allowance increased to £20k in April as planned
  • New NS&I bond previously announced set at 2.2% interest for deposits up to £3k
  • Tax-Free Childcare going ahead as planned from April.  All working families receive up to £2k/year for each child under 12.  Free childcare for 3-4 year olds will be 30 hours/week from September.
  • No change to the planned duties on alcohol, tobacco and fuel (increasing still though)
  • Minimum excise duty set for cigarettes
  • Universal Credit taper rate reduced from 65% to 63%


  • £140bn received since 2010 in tackling tax avoidance.  Along with other measures, a financial penalty will be introduced for professionals who enable tax avoidance schemes.
  • £20m more committed to support the Violence Against Women and Girls campaign
  • £5m to fund ‘returnships’ to help people return to work after a career break
  • £5m to fund celebration and education for the Centenary of the 1918 Representation of the People Act next year
  • Steps to give consumer bodies greater enforcement powers
  • Funding for research, particularly in STEM subjects
  • £353m for national roads, £690m for local roads to tackle congestion
  • Additional Devolved funding of £350m for Scotland, £200m for Wales and £120m for Northern Ireland
  • Additional funding for schools and maintenance loans extended to more higher education students
  • Introduction of new T-Levels to bolster technical training and qualifications
  • £2bn of grant funding available for social care over three years and funding to support implementation of the first few Sustainability and Transformation Plans in the NHS.  Funding for 100 ‘triage projects’ to trial options to reduce the burden on A&E.


For a statement that says “I am listening to the voice of business”, it’s certainly the bigger boys that the Chancellor’s been heeding.

For those setting out on their own, the benefits of giving up a relatively low-risk PAYE role are fast diminishing.  Despite everyone ‘using public services in the same way’, the significant risks those starting out on their own have are yet again blithely ignored.  Funding for ‘parental benefits’ for self employed persons presumably would need government funding - so more tax will have to be charged somewhere as the commitment to funding rather than borrowing is clear.

Now we’re looking to the surprisingly little-mentioned ‘Brexit’ for light at the end of the tunnel - stronger together!

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