On 30 October Rachel Reeves, new Chancellor of the Exchequer, delivered the Labour government’s first Budget. She emphasised the government’s commitment to “fixing the foundations to deliver change”, aiming to guide the UK towards economic recovery and initiate “a decade of national renewal” following 14 years of Conservative rule.
Central to this historic Budget is the plan to address the £22 billion “black hole” deficit in public finances inherited by the Labour government, whilst restoring stability and rebuilding public services.
Reeves stated that this budget will raise taxes by £40bn to ensure the funding for essential services and future economic stability. At the same time, it will raise government borrowing and spending, including a substantial boost in NHS funding to help rejuvenate healthcare services, with the goal of “rebuilding Britain and delivering change.”
A comprehensive breakdown of all the announcements of the Budget and how they may impact you and your business, are outlined in the complete guide which can be downloaded here. This guide is designed to help you understand the full scope of the new Budget measures. We hope that it will shed some light and provide you with valuable insights.
For further information or to book a personal consultation to discuss how the new Budget affects your financial planning please contact our tax expert Mark Moore.
The Autumn Budget highlights include:
- An increase in employers’ National Insurance contributions (NICs) by 1.2 percentage points to 15% from April 2025.
- The NICs and personal allowance thresholds will remain frozen until April 2028 when they will uprated in line with inflation.
- A reduction in the Secondary Threshold to from the current £9,100 to £5,000 when contributions will become due.
- Capital gains tax rates will increase from 30 October 2024. The lower rate will rise from 10% to 18%, and the higher rate from 20% to 24%. However, the rates of 18% and 24% imposed on the sale of second homes will not change.
- The rate of CGT on assets qualifying for Business Asset Disposal Relief and Investors’ Relief will rise gradually to 14% from 6 April 2025 and to 18% from 6 April 2026.
- The rate of CGT on assets qualifying for Business Asset Disposal Relief and Investors’ Relief will rise gradually to 14% from 6 April 2025 and to 18% from 6 April 2026.
- The CGT rates currently applied to carried interest will be increased to 32% from April 2025 and carried interest will be taxed fully within the Income Tax framework from April 2026.
- The Nil Rate Band and Residence Nil Rate Band for Inheritance Tax (IHT) are currently frozen at £325,000 and £175,000 respectively with the threshold freezes extended to April 2030.
- The government will bring unused pension funds and death benefits payable from a pension into a person’s estate for inheritance tax purposes from 6 April 2027.
- The Stamp Duty Land Tax (SDLT) charge for purchases of additional dwellings will be increased from 3% to 5% from 31 October 2024.
- The non-domicile regime will be abolished from 6 April 2025. Individuals who opt-in to the new residence-based regime will not pay UK tax on foreign income and gains for the first four years of tax residence.
- The Furnished Holiday Lettings (FHL) tax regime will be abolished from April 2025
- The VAT registration threshold will rise from £85,000 to £90,000 in April 2024.
- Alcohol duty freeze extended with the last government’s 5p cut maintained.
Get in touch
If you have any questions relating to any of the announcements covered in this Autumn Budget and how they may impact you and your business, please do not hesitate to contact us by completing the form below or get in touch with one of our tax experts.
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