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Top 4 tax changes in 2022

Since 2022 is expected to be particularly difficult for our financial situation, it is essential that you are up to date on the latest tax changes so that you can begin planning and prevent any penalties if you make a mistake. Read on to learn more about 4 tax changes happening in 2022:

Socially useful employment allowance for small companies has been increased to £5,000 per year

The Chancellor announced a measure to mitigate the impact of the health and care tax, which would be implemented from April 2022 for private sector companies.

After being raised from £4,000 per year, it was decided that the work allowance will be raised to its maximum level of £5,000 per year.

Changes in National Insurance eligibility and rates

As part of the government’s intention to implement a health and social care levy, in which working people pay to fund the NHS and the social care problem, national insurance rates are planned to increase by 1.25%. In 2022-23, this will be added to the remainder of your National Insurance payment; however, the goal is to separate the levy from the remainder of your payment starting in April of the following year.

The Residential Property Developer Tax, which would impose a 4% tax on corporations with earnings in excess of £25 million, is scheduled to be implemented

In his Autumn Budget 2021 address, the Chancellor announced the establishment of a 4 percent residential real estate developer tax (RPDT), which would be levied on the earnings of enterprises engaged in residential property development.

The application of Making Tax Digital to all VAT-registered firms was expanded

VAT-registered enterprises with a taxable turnover of above £85,000 have been required to comply with Making Tax Digital since its implementation in 2019.

The second phase of the Making Tax Digital initiative will begin in April 2022. This rids the need for minimum annual revenue, requiring all VAT-registered enterprises to utilise the system.

To learn more about the tax changes that will take effect in 2022 and how they may affect your small company, please contact CWR Accountants today.