It’s been a week since the Chancellor announced his Spring Budget, and if you caught a glimpse of our live updates on social media, you would know a summary of the announcements was promised!
Well, here you go. One of our Chartered Financial Planners, Ashley Biglin, has delved into the budget and laid it all out for you! Here is the breakdown of the key announcements:
- National Insurance Cut – the main rate of Class 1 employees NICs will be cut from 10% to 8% from 6 April 2024. This is based on earnings between £12,570 and £50,270. This means for every £10,000 you earn over £12,570, you would save around £200 per annum.
For self-employed the main rate of Class 4 NICs are now dropping from 9% to 6% from 6 April 2024. Class 2 NICs have now been abolished.
- The High-Income Child Benefit Charge – the threshold will be raised from £50,000 to £60,000 from April 2024. On top of this, the rate at which this is charged will be halved so that Child Benefit is not withdrawn in full until you earn over £80,000 pa or more. The government will also consult on moving to a household-based system rather than one based on individual incomes from April 2026.
- Capital Gains Tax – the higher rate of CGT on residential property disposals will be cut from 28% to 24% from April 2024. The lower rate will remain at 18% for any gains that are within an individual’s basic rate band.
- British ISA and British Savings Bond – one for later in the year! The government has announced the launch of a new British ISA and British Savings Bonds. The British ISA will be a £5,000 allowance in addition to the existing ISA allowance (£20,000) and will be a new tax-free product for people to invest in British-focused assets.
The British Savings Bonds will be delivered through National Savings and Investments (NS&I) and will be launched in April 2024. This product will offer a guaranteed interest rate, fixed for three years, increasing the savings opportunities available to consumers.
- Furnished Holidays Lettings – from 6 April 2025, the Government will abolish the tax advantage for landlords who let short-term furnished holiday properties.
- Fuel duty – will be frozen for another year by extending the temporary 5p cut and not uprating duty rates with inflation. Fuel duties have not risen since January 2011.
- Alcohol duty – will be frozen from 1 August 2024 until 1 February 2025. This extends the six-month freeze announced in the 2023 Autumn Statement.
- VAT threshold – the VAT threshold will be increased from £85,000 to £90,000 in April 2024.
If you are unsure how these announcements might impact you and your financial situation, please contact your adviser on 01482 219325. If you think you might require financial advice, do not hesitate to contact us by clicking here.
To view the gov.uk website for more details, click here.
