Discover key updates from the 2024 Budget, focusing on tax, business changes, and wage adjustments impacting our clients. Read our overview for essential insights.
Yesterday, the much-anticipated Autumn Budget was announced by Chancellor Rachel Reeves, marking Labour’s first Budget since returning to power. The £40bn in new tax measures focuses on strengthening public services and promoting economic stability. This post provides a brief overview of key announcements that may impact our clients, with links below for further details.
Personal Taxes
Income tax, National Insurance (NI), and employee VAT rates remain unchanged. New measures include:
- Income Tax: Thresholds set to rise with inflation from 2028, aiming to prevent more earners from moving into higher tax brackets.
- Capital Gains Tax: The basic rate on share profits rises from 10% to 18%, while the higher rate increases from 20% to 24%.
- Inheritance Tax: The threshold freeze has been extended to 2030; unspent pension pots will be subject to inheritance tax from 2027.
Business Taxes
Business tax adjustments include a rise in employer NI contributions, expected to impact larger firms while offering support for smaller ones:
- NI Contributions: Rate increased to 15% on salaries over £5,000, generating £25bn per year.
- Employment Allowance: Increased from £5,000 to £10,500 for smaller companies.
- Private Equity: Tax on profits from successful deals will increase from up to 28% to up to 32%.
- Corporation Tax: The main rate on profits over £250,000 remains at 25%.
Wages, Benefits, and Pensions
Minimum wage increases are on the way, along with adjustments to pensions and allowances that could affect your business:
- Minimum Wage: Over-21s’ rate increases from £11.44 to £12.21 per hour from April 2025.
- Carer’s Allowance: Earnings threshold raised from £151 to £195 per week.
Housing & Stamp Duty
- Stamp Duty Surcharge: Rises from 3% to 5% on second homes in England and Northern Ireland.
This post offers a snapshot of the main measures likely to impact our clients. For more depth and information on these topics and other areas affected by the Budget, we’ve included links below.
Budget 2024 summary: Key points from Rachel Reeves’s speech – BBC News
Wages, stamp duty, tax: What does the Budget mean for your money? – BBC News
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