18 October, 2022 in Industry News

How to un-budget the budget that wasn’t a budget!

Life is always changing for tax advisors as every year Chancellors announce changes to the tax system in the hope of stimulating growth that then raises taxes to pay for public services such as the NHS and education.

However too much change is not always a good thing especially if the timing is that of a dancer with two left feet.

The government usually has to consider the costs of any announcements made in the annual Budget to ensure the markets have confidence in the UK economy. These costings are supplied by the Office of Budget Responsibility (OBR) as part of the budget. The absence of OBR costing meant the mini-budget was not a budget.

In the last few weeks we have seen how important market confidence is.  For the ordinary person in the street, it impacts on the value of sterling against the dollar with oil priced based on the dollar and on mortgage interest rates. For the Government, it can increase the interest payable on government debts which are ultimately paid by the taxpayer.

The Chancellor has now announced a number of measures with OBR costings to try to restore confidence in the markets. This is in advance of the 31 October Medium-Term Fiscal Plan – the fourth announcement by the fourth Chancellor in 4 months.  

These measures are listed below:

Current position based on cancellation of 23 September 2022 announcement

Corporation tax

Increase to 25% rate from 1 April 2023 still in place

Diverted Profits Tax

Increase to 31% from 1 April 2023 still in place

Off Payroll Working

2017 and 221 reforms no longer cancelled.

Income tax

20% basic rate band to remain indefinitely

Income tax

45% income tax rate to remain as previously announced


Additional 1.25% tax on dividends from 6 April 2023

Alcohol Duty

Freezing of rates from 1 February 2023 cancelled

VAT-free shopping scheme


Energy price guarantee

Reduced from 2 years to 6 months with review on targeted support going forward

Announcements made on 23 September 2022 still kept

Stamp Duty Land Tax

Reduction announced remains

National Insurance

The cancellation of the additional 1.25 %

Capital allowances

£1 M Annual Investment Allowance extended indefinitely

Enterprise Investment Scheme

Scheme extended beyond 2025

Venture Capital Trusts

Scheme extended beyond 2025

The markets, business and the ordinary voter craves stability. Hopefully whether they are called budgets, mini-budgets or announcements, the next Chancellor statement will be more measured than the September 2022 mini-budget that wasn’t a budget.


Interested in finding out more? Contact:

Whilst every effort has been made by CavanaghKelly to ensure the accuracy of the information here, it cannot be guaranteed and neither CavanaghKelly nor any related entity shall have liability to any person who relies on the information herein. Information given here is for guidance only. Detailed professional advice should be taken before acting on any information contained herein. If having read the guidance here, you would like to discuss further; a member of our team would be pleased to help you.