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BRANAGANS
Accountancy Services Ltd
01709 327 215 | info@branagans.co.uk
October 2024 | Autumn Budget News 2024
The 2024 Autumn Budget has been announced by the Chancellor Rachel Reeves. These updates have broad implications, from rising costs for employers and property investors to new considerations for estate and tax planning. Proactive steps can help individuals and businesses navigate these changes and minimise impacts. At Branagans Accountancy Services, we're here to offer guidance to help you adapt to these shifts. Here's an overview of the main announcements and what they mean for you.
EMPLOYER NATIONAL INSURANCE CONTRIBUTION (NIC) RATE INCREASES
One of the most notable shifts is in employer NICs. The main rate of Class 1 employer NICs will increase from 13.8% to 15% from 6 April 2025. For employers, this will add to the cost of employing staff, meaning budgeting for this additional expense is essential, especially for small businesses.
The secondary threshold, the point at which employers begin paying NICs on employee earnings, will also be lowered from £9,100 to £5,000. This change could increase costs for employers, as more of each employee's earnings will fall within the NIC bracket.
INCREASES IN CAPITAL GAINS TAX RATES
Capital Gains Tax (CGT) is set to rise with immediate effect, impacting those selling assets such as property, shares, and investments. The main rates of CGT will now be 18% for non and basic rate taxpayers and 24% for higher and additional rate taxpayers. If you're considering the sale of assets, planning around this new rate structure is key to minimising tax liabilities.
INHERITANCE TAX (IHT) RELIEF CAPS AND INCLUSIONS
Changes to Inheritance Tax bring significant implications for those holding business and agricultural assets. From April 2026, IHT relief for business and agricultural assets will be capped at a total of £1 million. This cap limits the amount that can be excluded from an estate's taxable value, so it's vital for business owners and farmers to review their estate plans in light of this change.
Additionally, from April 2027, unused pension funds and death benefits will be included as part of an individual's estate for IHT purposes. This shift could increase the IHT burden on estates with substantial pension savings, which may otherwise have passed tax-
STAMP DUTY LAND TAX (SDLT) CHANGES FOR SECOND HOMES AND BUY-TO-LET PROPERTIES
The additional SDLT charge for those purchasing second homes or buy-
VAT AND BUSINESS RATE RELIEF ADJUSTMENTS FOR PRIVATE SCHOOLS
From 1 January 2025, a VAT rate of 20% will apply to private school and boarding fees, significantly increasing the cost of private education. This could also impact demand in the private education sector, with families adjusting their budgets in response.
The charitable relief for English business rates, which many independent schools benefit from, will be withdrawn from 1 April 2025. Schools will need to prepare for higher operating costs, potentially leading to fee adjustments or restructuring.
INCREASE IN MINIMUM WAGE
From April 2025, the National Minimum Wage will increase by 6.7%, rising from £11.44 to £12.21 per hour. This adjustment is intended to support wage growth for low-
INCREASE IN NATIONAL INSURANCE EMPLOYMENT ALLOWANCE
To support small businesses in managing employment costs, the National Insurance Employment Allowance will be increased from £5,000 to £10,500. This adjustment, aimed at alleviating the effects of rising NIC expenses, offers eligible businesses valuable relief. Small businesses are encouraged to make the most of this increased allowance to help retain staff and manage their NIC obligations effectively.
ISA AND LIFETIME ISA LIMITS REMAIN FROZEN
ISA, Junior ISA, and Lifetime ISA limits will remain frozen until April 2030. For investors and savers, this means limited options to increase tax-
FUEL AND ALCOHOL DUTY RATES
In a bit of positive news, fuel duty rates for 2025/26 will remain frozen, helping to stabilise costs for motorists and businesses reliant on fuel. Additionally, alcohol duty rates on certain draught beers will be cut, providing a small reprieve for the hospitality sector.
PREPARING FOR THE CHANGES
With some of these changes immediately and some taking effect over the next few years, now is the time to review your financial strategies. Whether you're a business owner facing increased NICs, a property investor adjusting to SDLT changes, or planning for IHT implications on your estate, forward planning can help mitigate impacts.
CONTACT US
If you'd like to discuss how the Autumn Budget might affect you or your business, Branagans Accountancy Services is here to help. Our team of experts can provide tailored advice and strategic guidance to help you navigate these changes efficiently. Please get in touch with us on 01709 327 215 or via email at info@branagans.co.uk.
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