Budget
News - Budget
30 October 2024
National Living wage up to £12.21 from £11.44 an hour (an increase of 6.7%)
Introduction of a single adult rate. The rate for 18-21 up 16.3% from £8.60 to £10 per hour.
Apprentices will get the biggest pay increase, with the hourly rate increasing from £6.40 to £7.55.
Cares allowance – the amount that carers can earn and still receive the allowance will rise to the equivalent of 16 hours at the National Living Wage per week. A carer can now earn over £10k per year and still get allowance.
Employers’ NI contributions increased 1.2 percentage points from 13.8% to 15%
Reducing secondary threshold from £9,100 to £5,000
Increasing employment allowance to £10,500, this means 865,000 employers won’t pay any NI at all next year. Over one million employers will pay the same or less than last year.
Spending on the state pension is projected to rise 4.1%, following the government’s commitment to the triple lock, the projected rise in 2025-26, is a £470 increase for over 12 million pensioners.
Lower rate will increase from 10 to 18%
Higher rate will increase from 20% to 24%
The rates on residential property will remain at 18 and 24%
BADR will remain at 10% for the first £1m, then raising to 14% from April 2025 and 18% from April 2026
Thresholds frozen to 2030 – The first £325k of any estate can be inherited tax free, rising to £500k if the estate includes a residence passed to direct descendants and £1m when tax free allowance is passed to a surviving spouse or civil partner.
Pensions will be brought into inheritance tax from April 2027, there will be a reform for Agricultural Property Relief and Business Property Relief. From April 2026, the first £1m of combined business and agricultural assets will continue to attract no inheritance tax at all, but for assets over £1m, inheritance tax will apply with 50% relief, at an effective rate of 20%
Tobacco duty escalator – renewed at RPI +2%, will also increase duty by 10% on hand-rolled tobacco this year and a flat-rate duty on all vaping liquid from 2026 and a one off increase in tobacco duty to maintain the incentive for smokers to give up smoking.
The government will maintain existing incentives for EVs in company car tax from 2028. It will also increase the differential between fully electric and other vehicles in the first rates of vehicle Excise Duty beginning in April 2025.
Increase of no more than £2 for economy class short haul flight
Private jets – duty increase by 50%, this equivalent to £450 per passenger.
A 40% business rates relief for retail and hospitality sectors. This is down from the current 75% rate set to expire on 31st March 2025. The 40% relief capped at £110k per business, will be in place through 2026.
Draft duty cut by 1.7%
Capped at 25% for duration of parliament
Research & Development incentives kept the same
Abolishment of the non-dom tax regime from April 2025, this applies to a UK resident whose permanent home – or domicile – for tax purposes is outside the UK. It means they do not pay UK tax on money they make elsewhere in the world. The government will instead introduce a new, residence-based scheme with “internationally competitive arrangements” for those coming to the UK on a temporary basis.
From April 2025 CGT on carried interest will increase to 32% and from April 2026, there will be further reforms.
Stamp duty land tax surcharge will increase by 2% to 5% from tomorrow.
Oil and gas companies – windfall tax on oil and gas profits to increase to 38% – now expire in March 2030
100% FY allowances and decarbonation allowances
VAT on private school fees from Jan 2025
Business rates relief removed from April 2025
No extension of income tax and NI thresholds beyond the decisions of the previous government. From 2028-29 personal tax thresholds will be uprated in line with inflation.
Contact us if you’d like to discuss any of the points mentioned in the budget and how it impacts you and your business.
