LWA Blog: Summary of the Spring Budget Tax Points for Businesses, Individuals and Property Owners

Chancellor Jeremy Hunt has presented this year’s Budget in the House of Commons, marking the final scheduled Budget before the upcoming general election, expected later this year. As the nation prepares for this pivotal political event alongside the ongoing economic recovery, the Spring Budget presents a crucial opportunity to set the fiscal direction for the future, reflecting the government’s commitment to fostering economic growth, supporting businesses, and ensuring a fair and sustainable tax system for individuals. Here’s our summary of the key tax points.

Summary for businesses (employers) and property landlords:

Abolition of furnished holiday lettings tax regime: The tax regime favourable to furnished holiday lettings is set to be abolished. This change will likely impact businesses operating in the short-term rental sector.

Full expensing for capital allowances: Capital allowances will be extended to leased assets, allowing businesses to fully expense these assets. This move aims to incentivise investment and boost business productivity.

VAT registration threshold increase: The VAT registration threshold will increase to £90,000 from £85,000. This adjustment aims to reduce the compliance burden on small businesses and provide them with more flexibility in managing their finances.

Reduction in national insurance contributions (NICs): From April, there will be a reduction in Employees’ Class 1 NIC to 8% from 10%, while for the Self-employed, Class 4 NIC will reduce from 8% to 6%. These reductions aim to increase take-home pay for employees and support self-employed individuals.

Summary for individuals

Abolition of stamp duty relief for multiple dwellings: Stamp duty relief for multiple dwellings will be abolished. This change may impact individuals involved in property transactions, particularly those purchasing multiple properties.

Reduction in higher rate capital gains tax (CGT): The higher rate of CGT will reduce to 24% from 28%. This adjustment aims to incentivise investment while ensuring a fair taxation system. Moreover, the move is anticipated to increase tax revenues overall by encouraging more property sales. According to Budget papers, the net extra tax take from the change is expected to be £690 million.

Increase in high-income child benefit charge threshold: The high-income Child Benefit charge threshold will increase to £60,000, with full recovery for income in excess of £80,000 from April 2024. This change will ensure that support is targeted towards those who need it most, while also providing relief for middle-income households.

Abolition of non-domiciled individuals regime: The non-domiciled individuals’ regime will be abolished and replaced with a simpler phased-in system for new arrivals for the first four years. Those who continue to reside in the UK beyond this period will be taxed on their worldwide income. This change aims to simplify the tax system and ensure fairness in taxation for all residents.

LWA are here to help you

If you need bespoke advice as a result of the Chancellor’s Spring Budget 2024, please contact a member of our team – we’re here to help. Call 0161 905 1801 in our South Manchester office or 01925 830 830 in Warrington, or you can email us via mail@lwaltd.com.