Tax Changes in 2022

There are some tax changes coming up that we wanted to remind you about.

The Return to 20% VAT Rate

In an attempt to save businesses during the pandemic, the UK Government introduced some welcomed VAT reductions for the tourism, hospitality and leisure sectors.

VAT for these sectors was dropped to a favourable rate of 12.5%, but come April 2022, that will revert back to the original rate of 20%.

Business Rate Discount

A one-year business rate discount of 50% has been given to eligible businesses in the retail, hospitality and leisure sectors. While being able to claim up to 50%, this discounted rate on business bills will be capped at £110,000.

Capital Gains Tax

The deadline for filing capital gains tax returns and paying any tax owing following a property disposal (which has increased in value) has now been extended from 30 to 60 days.

UK Quality Management Standards

From 15 December 2022, there will be new UK quality management standards on external audits. Three new standards relating to external audits have been issued: ISQM1 and ISQM2, which replace ISQC1 and ISQC2 respectively, and ISA 220 (revised).

These new standards encourage a proactive risk-based approach, ensuring auditors identify and respond more effectively to risk.

Corporation Tax

Corporation tax will increase from 19% to 23% for firms whose annual profits exceed £250,000.

Green Investment Relief

The Government is currently consulting on proposals for a new green investment relief, which will incentivise businesses to invest in green technologies such as solar panels, electric vehicle charging points and environmentally-friendly building improvements.

 

If you have any questions about these changes please contact our team.