Spring Budget 2024: Key Tax Changes
Chancellor Jeremy Hunt has announced the 2024 Spring Budget, emphasising permanent tax cuts as a strategy for long-term economic growth.
Our team of experts has delved into the details, highlighting the key tax reductions and support measures that will directly affect individuals and businesses throughout the UK.
Explore the details below to gain valuable insights into the measures that will help shape the economic landscape in the coming months.
National Insurance Reduction
From 1 April 2024, the National Insurance contribution rate will be reduced by 2%, for both employees and the self-employed. This equates to a saving of 2p for every £1 earned, offering additional financial relief to workers.
- For employees, the rate will decrease from 10% to 8%.
- For the self-employed, the rate will reduce from 8% to 6%.
VAT Threshold for Small Businesses
The threshold for mandatory VAT registration for small businesses will increase from £85,000 to £90,000, starting from 1 April 2024.
This increase will result in approximately 28,000 small businesses being exempt from paying VAT.
Growth Guarantee Fund
The government-backed loan scheme introduced during Covid to support businesses in the UK with access to finance is extending until March 2026.
It is part of a £200 million extension, which will involve renaming the scheme to the ‘Growth Guarantee Fund’.
Housing
As part of the Spring Budget 2024, multiple changes to taxes have been introduced. This includes:
- The higher rate of Capital Gains Tax, paid on profits from selling residential property, will be cut from 28% to 24%.
- Tax breaks for second homeowners profiting from holiday lets will be abolished, removing deductions for assets used in short-term rental properties.
- In June, the stamp duty tax break introduced when buying multiple properties in England or Northern Ireland will end.
ISA Tax Allowance Reform
The government are introducing a new British ISA, or Individual Savings Account, which will grant an additional £5,000 annual tax-free savings allowance for investments in UK equities.
Individuals can currently invest £20,000 a year tax-free, whereas the new ISA will enable them to invest £25,000 a year tax-free.
Changes to Non-Dom Tax Regime
In April 2025, the current tax regime for non-UK domiciled (non-doms), which applies to UK residents whose permanent home is overseas, will be abolished.
This will be replaced with new rules, which the UK government says will be a “modern, simpler, fairer and competitive residence-based regime”.
How Do These Changes Impact You or Your Business?
Want to better understand how these changes will impact you? Our team of chartered accountants in Walsall can help you understand how these changes impact you and your business, providing personal tax advice, corporate tax planning and support with international tax.
Alternatively, download our comprehensive budget rundown to see the full list of changes brought about by the Spring Budget and how these could affect you and your business in more detail.
Get in touch with a tax expert today to find out what we can do to help you.
