Extract from IDS Executive Compensation Review 321

Pre-Budget statement: an HR perspective

Towards the end of every year the Chancellor of the Exchequer delivers a pre-Budget report, signalling many of the proposals that will feature at the main event in the Spring. In this article we look at the HR and pay planning implications of the latest report delivered last month.

A main feature of the Pre-Budget is the announcement of new National Insurance Contribution (NICs) and tax credit rates along with income tax personal allowance levels, and tables are provided detailing the latest rates. One of the major announcements of this year’s Pre-Budget was a change to Capital Gains Tax (CGT). The Chancellor announced that CGT would become a standard rate in a move designed to create more clarity within the tax system, while taper relief would be abolished. As well as outlining these changes economic growth forecasts and the findings from a review looking at possible changes to National Insurance are also discussed.