Just Announced: Spring Budget 2024

The chancellor has unveiled the budget for 2024. Here are the key points:

Taxes

• National insurance contributions for employees are being cut from 10% to 8% from April – impacting about 27 million workers – with savings of up to £450 a year.

• Higher rate of property capital gains tax will be reduced from 28% to 24%.

• Self-employed NI rates will drop by two percentage points as well.

• The non-dom tax status has been abolished. It means foreign nationals who live in the UK, but are officially domiciled overseas, will no longer be able to avoid paying UK tax on their overseas income or capital gains. A “simpler” residency-based system will arrive in 2025.  A non-domiciled individual is someone who lives in the UK but whose permanent home is abroad.

• Stamp duty relief for people who purchase more than one dwelling in a single transaction, known as Multiple Dwellings Relief, is scrapped.

• The furnished holiday lettings regime has been abolished because it created “a distortion meaning that there are not enough properties available for long term rental by local people”.

• Air passenger duty will be raised for non-economy class plane passengers.

• The energy profits levy – the windfall tax on UK-produced oil and gas – is extended to 2029.

Business Support

Full expensing for businesses will apply to leased assets in future “when affordable”. Draft bill to be published shortly.

• VAT registration threshold for businesses upped from £85,000 to £90,000.

• Eligible film studios in England will secure 40% relief on their gross business rates until 2034. Tax reliefs made permanent at 45% for touring and orchestral productions and 40% for non-touring production.

Economy

• Office for Budget Responsibility predicts UK GDP growth of 0.8% (0.7%) in 2024 and 1.9% (1.4%) in 2025. Figures in brackets are OBR’s predictions last November.

• Office for Budget Responsibility expects Treasury borrowing of 91.7% of GDP (91.6%) in 2024-25, 92.8% (92.7%) in 2025-26. Figures in brackets are OBR’s predictions last November.

• Office for Budget Responsibility sees inflation coming in below target within “months”.

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