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Spring Budget 2024 - In Summary

Chancellor Jeremy Hunt delivered his ‘Budget for Long Term Growth’ on Wednesday 6 March 2024, promising ‘more investment, more jobs, better public services and lower taxes’.

Although billed as an election budget there were no real significant changes, and it was very much tinkering around the edges.

It delivered a package of measures to help individuals, families and small businesses by lifting of the High-Income Child Benefit Charge threshold, as well as mentioning some property tax changes, which will impact those who rent out furnished holiday homes and those selling residential properties. 

Whilst the reductions in National Insurance and the changes to the High-Income Child Benefit Charge are to be welcomed, they are unlikely to have a significant impact on people’s living standards, except for those with children and income of between £50,000-£60,000. These will partially offset the impact of the tax allowances and thresholds that have now been frozen for 4 years.

So, in summary it is, as you were!

Top implications for businesses

Increase in the VAT registration threshold.

The Chancellor has increased the VAT registration threshold to £90,000 from £85,000; a threshold which has been in place since 2017. The deregistration limit has increased in line with this to £88,000 from £83,000. This change in the threshold will apply from 1 April 2024.

Top implications for individuals

Taxation of non-domiciled individuals

Property tax changes

The Chancellor announced a number of changes to property taxation, including reducing the rate of Capital Gains Tax on residential property disposals from 28% to 24% and abolishing both the favourable tax treatments available on qualifying Furnished Holiday Lets and Stamp Duty Land Tax Multiple Dwellings Relief.

National Insurance reduction

The Chancellor announced further 2% reductions in both Class 1 and Class 4 NIC, reducing the rates to 8% and 6% respectively. The reductions will apply from 6 April 2024 for the new 2024/25 tax year. As before, the employer NIC rate remains unchanged at 13.8%.

As the reductions are only applicable to earnings between £12,570 and £50,270 per annum, it will mean a saving of up to £754 for individuals per annum, or around £63 per month. Together with the earlier reductions, it means up to an additional £1,508 and £1,131 per year in take-home income for individuals.

For our high profit Limited Company clients this makes taking more salary and less dividends a more palatable option, so please get in touch if you have any questions.

High Income Child Benefit Charge

Currently the Child Benefit starts to be withdrawn where one individual in a household has total income of more than £50,000 and is fully withdrawn where income is over £60,000.

With effect from 6 April 2024, as a temporary measure until the new rules are introduced, the thresholds will increase to £60,000 and £80,000 respectively. This change will affect around half a million working families.

Please don’t hesitate to contact us on 01827 54944 to discuss further.