Spring Budget updates 2024

On the 6th of March 2024, Chancellor of the Exchequer Jeremy Hunt delivered his Spring Budget speech, outlining proposed adjustments to taxes, welfare, and public spending. In this guide we cover everything you need to know about the tax adjustments affecting small businesses and individuals. ​

Reduction in National Insurance Contributions (NICs)​

Starting the 6th of April 2024, employees will experience a further decrease in Class 1 NICs, dropping from 10% to 8%. Similarly, self-employed individuals will benefit from a reduction in Class 4 NICs to 6%.​

In the Autumn statement, it was previously announced that self-employed individuals earning profits exceeding £12,570 would no longer need to pay Class 2 NICs. This change offers an additional advantage to sole traders.​

Tax Rules for Non-UK Domiciled​

By April 2025, a new regime for foreign income and gains will replace the remittance basis for tax-resident non-domiciled individuals, targeting those becoming tax resident in the UK after 10 years abroad, or 10 years of non-UK tax residency. ​

Child Benefit Charge Changes​

The income threshold for the High Income Child Benefit Charge will rise to £60,000 from April 2024, with a gradual taper to £80,000. Plans to base this charge on household income by 2026 are also underway.​

Capital Gains Tax (CGT) Adjustments​

The higher rate of CGT on residential property will decrease from 28% to 24% from April 2024, while the lower rate will remain at 18%.​

Furnished Holiday Lettings​

Tax benefits for landlords with furnished holiday lets will cease from April 2025, aiming to encourage longer-term rentals and address year-round housing shortages in tourist areas.​

Individual Savings Account (ISA) Allowance​

A new UK ISA allowance of £5,000 for investment in UK businesses will be introduced alongside the existing £20,000 ISA allowance.​

Easier Tax Payments​

Efforts are underway to simplify digital services, enabling taxpayers to pay Income Tax Self Assessment via instalments.​

Changes to VAT Thresholds​

The VAT threshold will increase from £85,000 to £90,000 from the 1st of April 2024, with the de-registration threshold rising from £85,000 to £88,000.​

Additional Support for Independent Film​

UK Independent films with budgets of up to £15 million will receive extra support through the Independent Film Tax Credit.​

Removal of Multiple Dwellings Relief​

Bulk purchases of dwellings will no longer qualify for stamp duty land tax relief from the 1st of June 2024.​

The landscape of personal and business taxation in the UK is rapidly evolving, and it’s important to understand the ongoing implications of these changes. Whether you're an individual or a business owner, adapting to these shifts requires careful planning and compliance. Seeking guidance from an accountant can provide clarity and confidence amidst these changes. Beany offers a wide range of services to help with this and to take the weight of accounting off your shoulders. ​