Spring Budget
At a Glance
Here are the main points from a financial planning perspective:
- Another 2% reduction to National Insurance from 6 April 2024. This will mean that NI for employees will be 8% and for the self-employed 6%. This is the second successive reduction that focuses on NI rather than income tax, giving the tax reduction only to working people and not to pensioners or landlords.
- Plans were announced for a UK ISA, providing an additional £5,000 allowance on top of the current £20,000 ISA allowance, if invested in UK-focused assets. This is not a measure that is being introduced immediately and the Government will be consulting on the best way to implement it, so we will provide further information once it’s available.
- The Child Benefit system is to be reformed from April 2026 once it’s possible for the government to assess household income as a whole. However, until then there will be some changes from 6 April 2024. The High Income Child Benefit Charge threshold is rising from £50,000 to £60,000, with the upper limit also increasing to £80,000. This means that more families will be able to claim the full amount of Child Benefit, with those whose benefit is being tapered losing less of the benefit than under the current rules.
- The capital gains tax (CGT) rate for property sales affecting higher and additional rate taxpayers has been reduced from 28% to 24%. The other rates, including CGT for basic rate taxpayers, remain unchanged.
- The Furnished Holiday Lettings tax reliefs for short term rentals are being scrapped from April 2025. Currently there are reliefs available for income tax and CGT but these are both being removed.
- From 1 June 2024 the Multiple Dwellings Relief, which reduces Stamp Duty Land Tax on bulk property purchases, is also being abolished.
- The taxation system for non-UK domiciled individuals will be replaced from 6 April 2025. They will pay UK tax on foreign income and gains after 4 years, as is the case for other UK residents.