‘Safety first’ for Chancellor Hammond
Given the weakness of the Conservative Government as a result of the General Election and the tortuous negotiations with the EU over Brexit, it was perhaps no surprise that Chancellor Philip Hammond’s Autumn Budget should have avoided, if not evaded, making any major changes to the tax regime for the majority of businesses and individual taxpayers. However, Charles Linaker, a tax partner with UNW, which has a dedicated Dental Business Unit headed by Alan Suggett, NASDAL media officer, says that the Chancellor will still have to find ways of raising extra tax from somewhere and warns that dentists should be on their guard.
Those who are currently self-employed will recall that, in his Spring Budget earlier this year, Hammond announced increases to the rate of Class 4 NIC from 9 per cent to 10 per cent and then from 10 per cent to 11 per cent, which he then had to withdraw with indecent haste when it was pointed out that they breached a manifesto pledge made at the 2015 General Election. Had the Government been in a stronger position, those increases would surely have been reintroduced, but the Chancellor confirmed that they will not now be implemented.
Similarly, dentists who operate via limited companies might have expected a possible reversal of the previously announced staged reduction in corporation tax rates, which many commentators thought could be implemented with relatively little controversy, not least because it would have been difficult for Labour to have opposed such a measure. But again, it was a case of no change as the Chancellor confirmed that 19 per cent would remain as the rate for three years from 1 April 2017 and then fall to 17 per cent from 1 April 2020.
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