A budget not to inspire and will do nothing to help the economy pick itself up, I believe, but I will cover off the main points. If your already fed-up, I am afraid there will be no real joy at the end of my piece.
Here we go, the main headlines:
A freeze on petrol and alcohol duty, but a new duty on vaping.
The freeze on petrol & alcohol has become the norm and it was only time before the alternative to smoking had to replace the tax lost.
VAT registration threshold increased from £85,000 to £90,000.
Such a small difference, hardly be noticed.
The Furnished Holiday Lettings regime to be abolished.
A big change and when coupled with the reducing allowances for CGT when you sell, it’s a double whammy. However, it seems the government wants to disincentivise holiday/2nd home ownership and this may well have that effect. If you have been thinking about selling just such a property, the sooner the better, as you will also lose 50% of the capital gains tax allowance from 6.4.2024 also. The abolishment of the furnished holiday letting takes effect from April 2025.
SDLT Multiple Dwelling relief abolished.
If you have a project/sale in progress that benefits form this relief currently make sure it is all concluded by 1st June 2024.
The higher rate for residential property Capital Gains Tax reduced from 28% to 24%.
A little good news in amongst an otherwise poor budget.
The Non-Domiciled status to be abolished with a new regime solely based on residence.
An easy target for governments to showcase they are getting tough! However, this one may well come back to haunt us if it drives wealth and investment overseas, from an economy that is already flatlined and in accident & emergency.
The income level at which the Child Benefit High Income Charge comes into effect, increased from £50,000 to £60,000 with the promise to introduce a system based on household income, not individuals.
The concerning part here is the words a new system based on household income!
From 6 April 2024 the National Insurance rate reduces from 10% to 8% for employees, and from 8% to 6% for the self-employed. This is after a 2% reduction already announced in the autumn.
A very small piece of good news for employees, but nothing for business that also pay this tax.
Announcements from previous budgets/autumn statements that will impact the 2024/25 tax year include.
Dividend allowance reduced from £1,000 in 2023/24 to £500 in £2024/25 for those on basic tax rate.
Capital Gains Tax allowance reduced from £6,000 in 2023/24 to £3,000 in 2024/25.
I think we can safely say both allowances will be zero very soon, so if you have any sales currently in these areas, get them completed asap.
In Conclusion
Our economy is in serious trouble, investment in enterprise has all but stalled and there was absolutely nothing in this budget to change that, nor can I see any changes to this coming down the road unfortunately.