The decision to scrap the 45% tax rate has been widely criticised amid a cost-of-living crisis.

The Chancellor has announced a U-turn. What’s the latest?

The Chancellor has confirmed that the tax cut will not go ahead, due to the distractions this policy has caused.

From 6 April 2023 those earning over £150,000 will continue to pay the top rate of 45% income tax.

However, due to other planned tax cuts, those with income over £150,000 will pay just 38.1% income tax on dividends from 6 April 2023 (currently 39.35%), meaning there will still be an incentive (albeit a smaller one) to delay dividends until on or after 6 April 2023.

The Chancellor is set to announce his medium-term fiscal plan on 23 November.

Of course at a4c we keep up to date with the budget details and subsequent u-turns so if you have any questions please don’t hesitate to get in touch:

01737 652 852