As the spring of 2024 unfolds, the Government have unveiled their
budget, setting the stage for economic policies, social initiatives, and
infrastructure development for the upcoming fiscal year. This pivotal moment
not only reflects current priorities but also shapes the nation in the months
and years to come. In this blog, we delve into some of the top topics emerging
from the spring 2024 budget and their potential implications.
National Insurance
The main topic for the budget was the cut in national
insurance again. The chancellor reduced the amount of national insurance
employees would pay by 2%. The rate going from 10% to 8% in April 2024. It is
estimated that the cut would be worth about £450 a year for someone on a
£35,000 full-time salary.
It is estimated that around 29 million workers are set to
benefit from the change. The rate of 'class 4' national insurance
contributions, which is the main rate paid on self-employed profits of
between £12,570 and £50,270, will be cut from 9% to 6% from 6 April.
This rate had been due to fall to 8% from 6 April, but the chancellor has taken
it one step further today. The self-employed will benefit too as the rate
is slashed from 9% to 6%.
Housing
The chancellor confirms plans to scrap the furnished holiday
lets regime. The initiative gives tax reliefs on properties being rented out to
holidaymakers and make renting out to holidaymakers more profitable than to
long-term tenants. The move is expected to raise £300m a year for the Treasury,
however a blow to furnished holiday lets owners.
The chancellor also announced the government will reduce the
higher rate of property capital gains tax. This is a tax paid on the amount of
gain when selling a property. Currently the rate is 28% for higher rate
earners, but this is being reduced to 24%
Business and Investment
The VAT registration threshold will be increased from
£85,000 to £90,000 from the start of April. This change is estimated to help
tens of thousands of businesses.
Benefits and Income Support
The Household Support Fund, which helps people struggling
with cost-of-living pressures and was due to close in four weeks' time, will
continue for another six months.
Full child benefits to be paid to households where
highest-earning parent earns up to £60,000 - the current limit is £50,000. The
top of a taper to withdraw the benefit will be raised to £80,000 from £60,000
at the moment.
The chancellor also announces a consultation on child
benefit rules, to apply it to collective household incomes rather than for
individuals from April 2026.
If there is something you want to know more about, you can
call us on 02920 653995 or
01656 530063 to discuss.
