Spring Budget 2024 – A Summary Relating to Tax and Pensions

In the wake of the Spring Budget 2024 – A Summary Relating to Tax and Pensions from Beesure.

Here’s a quick reminder of the Autumn Statement 2023

The Autumn Statement in 2023 introduced 110 measures aimed at bolstering economic growth. Notable changes included adjustments to taxation, such as the elimination of the “Class 2” National Insurance fee for self-employed individuals and reductions in employee National Insurance contributions. Permanent “full expensing” for businesses and adjustments to business rates were also highlighted, emphasizing support for entrepreneurship and investment. Pension reforms, notably the preservation of the pensions triple lock and proposals for pension pot consolidation, aimed to secure retirees’ financial well-being.

Spring Budget 2024 – A Summary Relating to Tax and Pensions

Income Tax

From April employee national insurance will be cut from 10% to 8%, and self-employed NICS from 8% to 6%.

Hunt says, combined with the changes announced in the autumn statement, 27 million people will gain £900. And 2 million self-employed people will gain £650. Hunt claims this will bring personal taxes to their lowest level since 1975.

Property Tax

Hunt says the government will reduce the higher rate of property capital gains tax from 28% to 24%. He also announces the abolition of stamp duty relief for those buying more than one dwelling.

Business Updates

In the autumn statement, Hunt announced the widely anticipated decision to make permanent “full expensing” for businesses. Hunt has now announced that the government will apply this to leased assets and that his change will come in “as soon as it’s affordable”.

There will be £200m to extend the recovery loan scheme, Hunt says. Small businesses being able to access the finance they need to grow & invest is crucial if we’re to grow our economy. That’s why we’re extending the Recovery Loan Scheme and renaming it as the Growth Guarantee Scheme – helping 11,000 SMEs to access the funding they need.

The VAT registration threshold will go up from £85,000 to £90,000, which should help SME’s who cluster at turnover just under the threshold.

ISA Updates

Hunt announces plan for new ‘British ISA’ allowing investments of £5,000 extra tax-free allowance to encourage more people to invest in UK assets. This ISA allowance will be on top of the existing £20,000 allowance.

Brian Byrnes, Head of Personal Finance at Moneybox, said: “While the British ISA may stand to benefit British businesses in time, and we welcome any reform intended to encourage investing, it is unlikely the British ISA will deliver real benefit to the vast majority of retail investors.”

Pension Updates

Speaking in parliament, Hunt said he will give new powers to the Pensions Regulator and Financial Conduct Authority to ensure better value from defined contribution schemes by “judging performance on overall returns not cost”.

Carol Young, chief executive of the £73bn Universities Superannuation Scheme, said she would have no problem with disclosures but would have “cause for concern” if ministers were to direct trustees as to where funds should be allocated.

The government will consider ways of making it easier for people to take their pension pots with them when they change jobs.

A word from Beesure

If you would like to discuss how the Spring Budget might affect your finances, please get in touch with your adviser. If you’d like some guidance in choosing the most suitable ways to save or invest your money to help you achieve your long-term financial goals, please get in touch.

Email us at info@bee-sure.co.uk, submit a contact form on our website, or call us at 0333 305 6692.

References: Spring Budget 2024 – A Summary Relating to Tax and Pensions

https://www.thesun.co.uk/money/26412542/savers-new-british-isa-spring-budget-2024/

https://news.sky.com/watch-live

https://www.theguardian.com/politics/live/2024/mar/06/spring-budget-2024-jeremy-hunt-tax-cuts-conservatives-labour-uk-politics-latest-updates

https://www.gov.uk/government/organisations/hm-treasury

https://www.cityam.com/spring-budget-2024-hunt-threatens-further-action-to-unlock-pension-investment-after-disclosure-plans/

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