Autumn Budget 2017 – what do employers need to know?

28 Nov 17 by
Autumn Budget 2017

Last Wednesday the Chancellor delivered the first budget since the general election, it was also the first Autumn (as opposed to Spring) budget but were there any interesting announcements that employers need to know?

The short answer is yes.

A key announcement for employers was that the government would publish a discussion paper as part of the response to the Taylor Review. In July the Taylor Review made a number of recommendations on the issue of employment status including a recommendation that “worker” status be redefined as “dependant contractor” status and that there be additional legislative reform to define the terms more specifically and clearly. This discussion paper will consider the case and options for reform of the employment status test. The government acknowledged that this is a difficult and complex area and they intend to fully consult stakeholders. This is not an immediate change but will be an important one if it comes about and we will of course keep you updated. 

Another area to be watchful over is the use of Private Service Companies (PSCs) and off payroll working. There has been concern that PSCs have been used inappropriately to reduce an individual’s tax bill by paying the individual through a company rather than as an employee. In April 2017 this process was reformed in the public sector and in the public sector responsibility for the correct tax being paid now falls on the paying organisation rather than the individual. In the budget the Chancellor announced that the government was looking into the issue in the private sector. It was stated that the government had already commissioned research on this issue and that there would be consultation about it. The research is due to be published in 2018 – so again watch this space for updates.

Other announcements included increases in pay scales and tax thresholds. Firstly there will be an increase in the National Minimum Wage.

From April 2018 the rates will be increased to:

  • Apprentices: £3.70 an hour
  • 16-17 year olds: £4.20 an hour
  • 18-20 year olds: £5.90 an hour
  • 21-24 year olds: £7.38 an hour 

Also from April 2018 the National Living Wage for those aged 25 and over will increase from £7.50 an hour to £7.83 an hour.

Finally, there will be a change to the tax free personal allowance. From April 2018 the amount individuals will be entitled to before tax will rise from £11,500 to £11,850. In addition, the higher rate tax threshold will rise to £46,350. There are also likely to be further rises in the future as the government has given its commitment to raise the personal allowance to £12,500 and the higher rate tax threshold to £50,000 by 2020.


We are the HR and employment law experts from esphr.

It’s our mission to advise and develop the employment law capability of HR professionals wherever we can, helping HR teams make a real commercial difference to their organisations. That way, you spend less time solving operational issues and more time actioning projects that drive far-reaching change in your company.

Call 0333 006 2929 or email today to discover exactly how we can help you.