Autumn Budget 2024

3 weeks, 4 days ago by Oliver Atkinson

The Chancellor, Rachel Reeves, delivered the 2024 Autumn statement to the House of Commons yesterday, following considerable speculation over how the government will raise £40bn. The Labour party’s first statement in 14 years is aimed to correct the “£22bn blackhole left in the public finances by the previous conservative government”. A fair number of adjustments have been made in this statement, so let’s take a look.

Employers National Insurance:

• Employers’ National insurance increases by 1.2 percentage points to 15% from 06/04/2024.
• The threshold which Employers National insurance is due will be decreased from £9,100 to £5,000.
• Employers’ National insurance allowance increases from £5,000 to £10,500.

National Minimum Wage:

National Minimum wage has increased by the following amounts, effective from April 2025:

• Aged 21+ from £11.44 to £12.21
• Aged 18 - 20 from £8.60 to £10.00
• Under 18 from £6.40 to £7.55
• Apprentice from £6.40 to £7.55

Capital Gains Tax:

• The lower rate of capital gains tax will increase from 10% to 18% and the higher rate from 20% to 24%.
• The capital gains tax due on rental properties will remain the same, meaning the lower rate is still 18% and the higher rate is 24%.
• Business asset disposal relief will remain at 10 per cent this year, before rising to 14 per cent in April 2025, and to 18 per cent from 2026/27.

Inheritance Tax:

Thresholds which were originally frozen until 2028 will now be extended to 2030, meaning the first £325,000 of any estate can be inherited tax-free, this rises to £500,000 if the estate is passed to direct descendants and £1m when passed to surviving spouse.

Business Rates:

For those paying business rates, the Chancellor announced that the government will provide a discount of 40% which replaces the discount of 75% due to expire in April 2025.

Benefits in Kind

The government has also confirmed the plans for real time reporting of most benefits in kind via payroll software from April 2026.

Other Tax & Changes

• Income tax and National insurance thresholds to increase inline with inflation from 2028-29
• State pension will increase by 4.1% in the 2025-26 tax year.
• Non-dom tax status to be abolished, replacing it with a residence-based regime.
• Private school fees to be subject to VAT from January 2025.
• Fuel duty will be frozen next year, meaning there would be no 7p increase next year and maintaining the 5p cut for another year.
• Stamp duty land surcharge for second homes, increasing by 2% to 5% from 31/10/2024.
• Duty on non-draught products will increase inline with RPI next February, whilst duty on draught products decreasing by 1.7%.

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