Autumn Statement 2022: what was in the small print?

Chancellor Jeremy Hunt's Autumn Statement has set out the government's plan to curb inflation and navigate the anticipated recession, through a mix of tax increases and spending cuts.

While the Chancellor talked through the most significant of his planned changes in Parliament last week, some details slipped under the radar.

Here, we've looked through the small print to find some of the changes that might not have made headlines, but could still impact your wallet.

Support for mortgage interest

The Chancellor announced changes to Support for Mortgage Interest (SMI) to help borrowers weather rising interest rates.

From spring 2023, those on Universal Credit will be able to apply for a loan to help with interest repayments after claiming for three months in a row, instead of the current nine.

Alongside this, the government has abolished the 'zero earnings rule' which prevented Universal Credit claimants who were in work from receiving any of this support.

The Autumn Statement made no mention of changes for other benefits claimants who can access SMI - these include Pension Credit, income-based Jobseeker’s Allowance (JSA), income-related Employment and Support Allowance (ESA), and Income Support. 

• Find out more: What to do if you can't pay your mortgage

Social care reform delayed

Planned reforms to the social care sector have been delayed by two years, and the rollout will now not take place until October 2025.

The £86,000 cap on social care was due to be introduced in October 2023, and would limit the amount of money someone would need to spend on social care in their lifetime, though this would not include 'accommodation' or other daily living costs.

Currently, people must fund the costs of social care themselves, unless the value of their assets is less than £23,250.

The statement said that funding for local authorities will be maintained to enable local governments to address social care pressures, through the Social Care Grant.

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Threshold frozen for VAT registrations

The VAT registration threshold will be maintained at £85,000 for two years from April 2024 - this is the turnover at which businesses must register to pay the tax.

This means more small businesses will have to register for and pay VAT, as their prices and sales will likely rise with inflation but the VAT threshold will not. 

• Find out more: self-employed VAT return

Smaller benefits uprated

Like the state pension, Universal Credit and other major benefits, the Married Couple's Allowance and Blind Person's Allowance will also increase in line with inflation in 2023-24.

The increase of 10.1% (based on September's CPI inflation measure) means Married Couple's Allowance will rise to between £4,010 and £10,375, and Blind Person's Allowance to £2,870.

The benefit cap – the limit on the total amount of benefit claimants can receive – will also be uprated in line with inflation for the first time since it was created in 2013. The only previous change to the cap was when it was decreased in 2016.

From 2023-24, couples and those with children will have a cap of £22,020 outside London and £25,323 in Greater London. Single people are capped at £14,753 outside London and £16,967 in Greater London.

• Find out more: State pension to increase by a record 10.1%

Online Sales Tax cancelled

There will now no longer be an Online Sales Tax (OST), which was originally proposed as a way of balancing taxation between in-store and online retailers.

Reportedly, concerns were raised about the complexity of an OST, and the risk of creating unintended unfairness between different business models. 

The government said a response to the consultation on the tax would be published shortly.

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Benefits migration delayed

The migration of some benefits into Universal Credit has been delayed.

Claimants of Employment and Support Allowance (ESA), a benefit for people who can't work as a result of physical or mental illness, were due to be moved onto Universal Credit in 2024, but this will now take place in 2028.

Anyone receiving ESA who wants to make a claim for Universal Credit can still do so. 

Many claimants may find themselves subject to ‘natural migration’ to Universal Credit, which usually occurs due to a change of circumstances. This means they'll lose out on the transitional protection that comes with managed migration – where your Universal Credit payment is topped up to make sure you're not worse off as a result of the migration.

Plans to create a new housing element of pension credit have also been pushed back to 2028-29, and eligible pensioners will continue to receive Housing Benefit instead.

The government expects these delays to save them nearly £1.2bn over the next six years.

• Find out more: Pension credit explained

Alcohol duty rates not frozen

The planned freeze on alcohol duty rates announced in September's 'mini-budget' was reversed when Hunt became Chancellor, meaning the price of alcohol is likely to go up next year.

New rates for 2023-24 have not yet been announced, but the government's Autumn Statement documents anticipate an extra £1.3bn will be raised as a result of reversing the freeze.