Autumn Budget 2024 – 30 October Highlights

The Budget raises taxes by £40bn, and the tax changes include:

Personal tax

• Non-UK domicile regime
  • Confirmation that this will be abolished from April 2025
  • Confirmation that the Government intends to “close the loopholes” in the previous Government’s plans – no further details provided in the Budget speech.
  • Extend temporary repatriation relief to three years
• Capital Gains Tax (CGT)
  • Increase lower rate from 10% to 18% from today
  • Increase upper rate from 20% to 24% from today
  • Lifetime limit for BADR remaining at £1m
  • Business Asset Disposal Relief (BADR) rate of 10% remains for now, then 14% from April 2025 and 18% from April 2026
  • Carried interest rate will be 32% from April 2025
• Income tax
  • Allowances and thresholds will increase by inflation from 2028

Employment tax

• Employer’s NIC changes
  • Increase from 13.8% to 15.0% from April 2025
  • Reduce secondary threshold from £9,100 to £5,000
• Employment allowance increasing from £5,000 to £10,500

Inheritance tax (IHT)

• Nil Rate Band of £325,000 frozen until 2030
• From April 2027 inherited pensions will be subject to IHT
• Agricultural Property Relief and Business Property Relief will be reformed from April 2026 – up to a combined £1m of assets will attract 100% relief, but for assets over £1m only 50% relief
• 50% IHT relief for shares listed on AIM and similar markets

Property taxes

• Intend to introduce lower rate for retail, hospitality and leisure properties from 2026/27
• Business rates for retail, hospitality and leisure properties will benefit from 40% relief in 2025/26 – up to a maximum discount of £110,000 per business
• Stamp Duty Land Tax higher rate for additional dwellings to rise by 2%, from 3% to 5%, from tomorrow

VAT

• Confirmation that VAT will apply to private school fees from January 2025

Other

• Investment will be made in technology and extra HMRC staff to reduce tax gap
• Interest rates on unpaid tax will be increased
• Fuel duty to remain frozen next year including 5p cut
• Introduction of a flat rate duty on vaping liquid
• Alcohol duty on draught drinks will be cut by 1.7%
• Air passenger duty increasing by 50% on private jets

Further details to follow in our full summary, available on 31 October 2024.

Please contact Mark Baycroft, Partner with any queries.