The Autumn 2024 Budget in Summary

October 2024

Please find below a link to our summary of the Autumn Budget delivered by the Chancellor, Rachel Reeves, on Wednesday 30 October.

In presenting Labour’s widely anticipated first Budget in 14 years, the Chancellor was faced with a challenging task. Following her announcement of a ‘black hole’ in the public finances, Ms Reeves faced the need to renew the Treasury’s coffers while maintaining Labour’s manifesto promises. In the event the programme outlined consisted of around £41 billion worth of tax increases over the next five years, alongside plans to rebuild infrastructure, the health service and schools. Any idea of a return to austerity was quashed by the Chancellor but the implications for markets and the UK economy as a whole remain to be seen over the coming months and years.

Our summary includes further details of the key headline items:

• The main rate of Class 1 Employer National Insurance Contribution ('NIC') will be increased from 13.8% to 15% from 6 April 2025.

• The secondary threshold at which employer NICs are payable will be reduced from £9,100 to £5,000.

• Main rates of capital gains tax increases with immediate effect to 18% for non and basic rate taxpayers and 24% for higher and additional rate taxpayers.

• Inheritance tax (IHT) business and agricultural reliefs will be capped at a total of £1 million from April 2026.

• AIM listed shares will only qualify for 50% IHT relief from April 2026 and are not eligible for the £1 million cap.

• Unused pension funds and death benefits will be included as part of an individual's estate for IHT purposes from April 2027.

• The additional SDLT charge for second homes and buy-to-let properties increases from 3% to 5% from 31 October 2024.

• VAT of 20% will be applied to private school and boarding fees from 1 January 2025, while the charitable relief for English business rates will be withdrawn from 1 April 2025.

• ISAs, Junior ISAs and Lifetime ISA limits will remain frozen until April 2030.

• Fuel duty rates for 2025/26 will remain frozen and alcohol rates on certain draught beers will be cut.

We hope that our summary will highlight the key aspects of the Chancellor's proposals that are likely to affect you. Over the course of the coming weeks, we will be providing you with more detailed thematic analysis of the implications focusing on issues such as the CGT changes. In the meantime, please contact us if you would like to discuss any specific element of the Budget.