BRIEF HIGHLIGHTS OF TAX AND NATIONAL INSURANCE CHANGES:
National Insurance:
Employees:
- Main rate of Class 1 NICs to be cut again from 10% to 8% from 6 April 2024.
Self-Employed:
- Class 4 NICs rate will be cut from 9% to 6% from April 2024.
Employers:
- No changes to threshold level or rate of Employer NICs.
Tax and allowances:
- Personal Income Tax and National Insurance contributions thresholds, remain fixed at their current rates until April 2028.
- National Living Wage to increase from £10.42 an hour for age 21 and over to £11.44 from 1 April 2024.
- NMW rates to apply from April 2024:
>18 to 20 year olds from £7.49 to £8.60 per hour
>16 to 17 year olds from £5.28 to £6.40 per hour;
- No changes to the previously notified Dividend Allowance that is to be reduced to £500 from April 2024.
- Furnished Holiday Lettings regime abolished from 6 April 2025. Going forwards profits will be taxed in the same way as any other rental property profits.
- Capital Gains Tax higher rate on residential property gains reduced from 28% to 24% from 6 April 2024. No change to basic rate, which remains at 18%.
- No changes to the previously notified Capital Gains Tax Annual Exempt Amount that is to be reduced to £3,000 from April 2024.
- No change to Corporation Tax rates from 1 April 2024:
>19% for taxable profits below £50,000 (small profits rate)
>25% for taxable profits above £250,000 (main rate)
Marginal Relief available to be tapered between the small profits rate and the main rate.
- 100% Capital Allowance first year tax relief (in addition to current AIA allowances) for Limited Companies only, now made permanent.
- No changes to IHT thresholds or rates. From 1 April 2024 personal representatives of estates will no longer need to have sought commercial loans to pay inheritance tax before applying to obtain a "grant on credit" from HMRC.
- No changes to current ISA limits or taxation of savings. However it was announced that a new "UK ISA" with an additional allowance of £5,000 will be introduced, but no start date yet released.
- Van and Fuel benefit amounts to remain fixed at 2023/24 rates for 2024/25. HMRC Double cab pick up updated guidance in February 2024 cancelled and remains unchanged for 2024/25.
- High Income Benefit Charge threshold raised to £60,000 (was £50,000) from April 2024. The income level at which full claw back of the benefit is achieved, has been raised to £80,000 (from £60,000).
- Alcohol duties remain frozen until 1 February 2025. Previous 5p per litre cut in fuel duty will remain in place until March 2025.
- Significant changes to "Non-Dom" UK residency and Domicile regime planned for April 2025 onwards.