Earlier today, the Chancellor, Jeremy Hunt delivered his Spring Budget with the Governments main focus being on growing the economy.

Whilst the Chancellors Budget includes many announcements and changes to the tax system, we have summarised below the main points which will impact our clients in the services we provide.

 

• The main rate of National Insurance cut from 10% to 8% from 6 April 2024. 
• Class 4 National Insurance for self-employed individuals paid on profits between £12,570 and £50,270 will be cut from 8% to 6% from April 2024.
• As previously announced, Class 2 National Insurance paid by self-employed individuals earning more than £12,570 will be abolished from April 2024.

 

• The Government will abolish the tax relief available to Furnished Holiday Lets (FHL) from April 2025.
• The higher rate of Capital Gains Tax (CGT) for residential property disposals will be cut from 28% to 24% from 6 April 2024. The lower rate will remain unchanged at 18% for any gains that fall within an individual’s basic rate band.
• From 1 June 2024, the Government is abolishing Multiple Dwellings Relief (a bulk purchase relief) in the Stamp Duty Land Tax regime.

 

• The VAT registration threshold will increase from £85,000 to £90,000, and the deregistration threshold from £83,000 to £88,000 from 1 April 2024.

 

Whilst writing, we would remind you of the new National Living Wage and Minimum Wage from 1 April 2024:

	New Rate (From April 2024)	Current Rate (Since April 2023)	Percentage Increase
23 years old and over	£11.44	£10.42	9.8%
21-22 years old	£11.44	£10.18	12.4%
18-20 years old	£8.60	£7.49	14.8%
16-17 years old	£6.40	£5.28	21.2%
Apprentice Rate*	£6.40	£5.28	21.2%

*This rate is for apprentices under 19 or those in their first year. If the apprentice is 19 or over and past their first year, they will be entitled to the rate that applies to their age.

New rate to apply to 21 and 22-year-old workers for the first time, rather than just those 23 and over.

If LBW process payroll on your behalf, we will automatically uplift any employee’s on National Minimum/Living Wage to ensure all legislation is met.

• The Non-Dom tax regime for UK residents whose permanent home is overseas is to be replaced with new rules from April 2025.
• The High Income Child Benefit Charge (HICBC) threshold will increase from £50,000 to £60,000 from April 2024. The rate at which HICBC is charged will also be halved so that Child Benefit is not fully withdrawn until individuals earn £80,000 or higher. The government plans to administer the HICBC on a household basis rather than an individual basis by April 2026.
• The Government will create an additional Individual Savings Account (ISA) with a £5,000 allowance to invest in UK listed companies. This would be in addition to the £20,000 that can be subscribed into an ISA.

 

As we have always maintained, with all matters referred to in the Chancellor’s announcements the “devil will be in the detail” and the full impact and understanding of all the announcements will not be made clear until the full parliamentary process has been undertaken and the proposals become law in the relevant finance act.

Last modified on Wednesday, 06 March 2024