On Wednesday 15th March, Chancellor Jeremy Hunt delivered his Spring Budget for 2023. Our tax experts outline some of the key changes announced.

The Chancellor of the Exchequer, Jeremy Hunt, unveiled his Spring Budget in the House of Commons on Wednesday 15th March, detailing the Government’s plan of action for the UK economy.

According to the Chancellor, the Government’s plans for growth announced in the Spring Budget are founded on four ‘E’ pillars: everywhere, enterprise, employment, and education.

What has been announced in the Spring Budget 2023?

Alongside a forecast of the British economy, a collection of tax changes and reliefs were announced in the Spring Budget, with a focus on business investment. Below, we provide a summary of the main announcements.

The UK economy and public finances

  • The Office for Budget Responsibility (OBR) predicts the UK will avoid a technical recession in 2023, despite forecasting the economy to shrink by 0.2%. In addition, the inflation rate is predicted to fall to 2.9% by the end of 2023.
  • The UK debt is forecasted to be 92.4% of GDP this year, with it being predicted to rise to 93.7% in 2024.

Investment Zones

  • The Government has launched a refocused Investment Zones initiative, offering tax reliefs and £80m government funding over the next five years to 12 new investment zones. These clusters for growth will be spread across the UK including regions such as the West Midlands, Greater Manchester, South Yorkshire, West Yorkshire, East Midlands, Teesside, the Northeast and Liverpool.

Corporation Tax

  • As previously planned, the main rate of corporation tax is confirmed to increase from 19% to 25% for businesses with taxable profits over £250,000. Companies with profits between £50,000 and £250,000 will be required to pay a corporation tax rate between 19% and 25% from April 2023.
  • From 1 April 2023 until 31 March 2026, a ‘full expensing’ 100% First Year Allowance will be introduced, allowing businesses to deduct the full cost of qualifying main rate plant and machinery investment from that year’s taxable profits.  For qualifying special rate expenditure, a 50% First Year Allowances can be claimed instead.
  • To promote investment into innovation, small and medium sized businesses that spend 40% of their expenditure on research and development (R&D) will benefit from an enhanced payable tax credit from 1 April 2023. This will be at 14.5% compared to the new 10% for other payable tax credits also coming into effect from 1 April 2023. Qualifying businesses will benefit from a return of £27 for every £100 spent on R&D.
  • The exclusion of overseas expenditure for R&D claims is being delayed until 1 April 2024. This is to tie in with a decision on a single R&D scheme which will be announced at a future fiscal event.
  • Until 2025, tax reliefs for theatres, orchestras, and museums and galleries will remain at the current rates of 45% to 50% to help support the cultural and creative industries.


  • The annual allowance for pensions tax charges will increase from £40,000 to £60,000 from 6 April 2023.
  • The adjusted income threshold for the tapering of the annual allowance will be increased from £240,000 to £260,000, while the minimum Tapered Annual Allowance (TAA) and Money Purchase Annual Allowance (MPAA) will be increased from £4,000 to £10,000.
  • The Lifetime Allowance, currently set at £1.07m, will be abolished.


If you would like further information on the key changes announced in the Spring Budget 2023 or require tailored advice on how these new policies will impact your business, contact us today to discuss your needs with one of our specialist tax team.

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