Stephen Theaker, senior tax partner at Newport’s UHY Hacker Young chartered accountants, outlines what we are likely to see George Osbourne’s Autumn Statement.

The latest economic figures provide mixed reading for Chancellor George Osborne.

The unemployment rate may have fallen to a seven-year low of 5.3 per cent, but GDP growth slipped from 0.7 per cent to 0.5 per cent in Q3. That sluggish growth is the driving factor for the inflation rate remaining below government targets.

So what can we expect to be covered in first all-Tory Autumn Statement in two decades?

It’s safe to predict that belt-tightening will be the central theme.

The Chancellor will likely be under even more pressure than usual to cut expenditure and raise revenue and we’re expecting to see a range of new tax policies and money-saving measures announced.

The most high-profile of these is of course tax credits. The House of Lords has said it won’t budge on Mr Osborne’s tax credits cuts until an independent study on the matter is completed, but this isn’t stopping the Chancellor. He has already said that he will use the Autumn Statement to lay out a plan that 'can achieve the same goal of reforming tax credits, saving the money we need to save to secure our economy, while at the same time helping in the transition'.

Expect a slightly diluted version of his proposed £4.4bn cut to tax credits, specifically in relation to families and low-income households.

Sicking with tax, we also see an announcement around Personal Service Companies and IR 35.

Currently, contractors, freelancers and other professionals can set up companies of which they are the sole employee and cut their tax up to 20 per cent.

Ministers have been discussing ways to crack down on this, claiming that PSCs are used by as many as 100,000 people resulting in a potential tax loss of up to £400m.

It most notably featured in the parliament when around 1,500 TV presenters – predominantly from the BBC – were revealed to have used PSCs.

We could also see an attempt to raise tax revenue with a stop-gap policy ahead of next year’s rise in dividend taxation.

From April, income from dividends of more than £5,000 will be taxed at 7.5 per cent for basic rate tax payers and 32.5 per cent for higher-rate payers. Some taxpayers may therefore be tempted to take bonus dividends before then to beat the increase. It’s possible that Osborne could bring in anti-avoidance legislation to stop this from happening.

Major changes to pension taxation are set to take effect in April 2016.

The Lifetime Allowance – how much you can save in your pension without paying tax – is set to be lowered from £1.25m to £1m. This will be coupled with an Annual Allowance Taper for high earners, which significantly reduces tax relief on annual pension contributions. Under current rules, you can bring forward unused allowances from previous years to boost pension funding in the present year. If you thing is certain, it’s the fact that this is only one of several issues around pensions and pension taxation. Time will tell.