This week Jeremy Hunt addressed the House of Commons to deliver his 2024 Spring Budget. Key themes were the ongoing falling rate of inflation (below 2% in coming months!) and a smattering of tax cuts to primarily reward workers and parents.
Tax Changes:
- As of April, Employee National Insurance rates will witness a reduction from 10% to 8%.
- Self-Employed National Insurance rates will also see a decrease from 8% to 6%, effective from April.
- The threshold for the high-income child benefit charge will be raised from £50,000 to £60,000. Child Benefit will also be lost more slowly, tapering away as income rises up between £60,000 and £80,000, whereas the current system has seen a taper from £50,000 to £60,000.
- The Non-dom tax regime is set to undergo a complete overhaul, with new regulations slated for introduction in April 2025. Under the revamped system, individuals newly arriving in the UK will be exempt from paying taxes on foreign income and gains during the initial four years of residency.
- The ‘higher rate’ of Capital Gains Tax on residential property will be lowered from 28% to 24%.
Pensions & Savings:
- A new £5,000 “British ISA” tax allowance to be introduced (after consultation), enabling more investment in UK-listed businesses.
- NS&I will launch new British Savings Bonds offering a guaranteed interest rate for three years.
- The State Pension triple lock will remain in effect.
Living Costs:
- Air passenger duty for business class flights is scheduled to increase.
- Fuel duty will remain frozen for another year.
- The freeze on alcohol duty will be extended until February 2025.
- A new tax on vaping products will be introduced from October 2026.
What does it all mean for you?
Want to know more? Our guide to the Spring Budget offers a full breakdown of the chancellor’s tweaks and changes. Take a moment to read our guide and reflect on the changes which may impact you and your family.
We have identified financial planning ‘threats and opportunities’ and will raise anything which may change your financial plan when we next meet. In particular, we will monitor the consultation on the new ‘British ISA’ allowance and shall adapt our advice as appropriate once it is introduced. If there is anything in particular you would like to discuss, please contact your lead planner.
To download our full guide, click the image below:
