Page 8 - Budget Newsletter November 2022

Company cars and vans

The appropriate percentages used in benefit-in-kind calculations for electric and ultra-low
emission cars will increase by one percentage point each year from 2025/26 to 2027/28, to

a maximum of 5% for electric cars and 21% for ultra-low emission cars

Benefit-in-kind rates for other vehicles will be increased by one percentage point for
2025/26 up to a maximum of 37% and will then be fixed in both 2026/27 and 2027/28.

For 2023/24, car and van fuel benefit charges and the van benefit charge will increase in
line with CPI.

Capital gains tax

The annual exempt amount for individuals and personal representatives will be cut from

£12,300 to £6,000 for 2023/24 and in the following tax year cut again to just £3,000.

The annual exempt amount for most trusts will be cut to £3,000 (minimum £600) in
2023/24 and then cut again in 2024/25 to £1,500 (minimum £300).

Planning point
The 75% plus reduction in the capital gains tax (CGT) annual exempt amount by 2024/25
makes it important to consider whether the exemption can be used before the end of this
tax year and again, at its reduced £6,000 level in 2023/24.

The lower CGT allowance also increases the importance of maximising ISA
contributions, as ISAs remain free of CGT as well as UK income tax.

Inheritance tax

The inheritance tax nil rate band and residence nil rate band (RNRB) will remain at their
current levels (£325,000 and £175,000 respectively) until April 2028. The estate threshold
at which RNRB starts to be tapered will also be unchanged at £2m.

Raymond James Budget Newsletter November 2022 7