Highlights from the Spring Budget 2024

Written By catherine alexander

The Highlights from today’s Spring Budget delivered by Chancellor Jeremy Hunt. A link to the full budget document will be provided below.

  • Class 1 National Insurance Contributions (NIC’s) will be cut from 10% to 8% and Class 4 NIC’s will be cut from 8% to 6%.

  • The higher rate of Capital Gains Tax (CGT) for residential property gains will be reduced to 24% with effect from 6 April 2024.

  • An increase in the starting level where the High Income Child Benefit (HICBC) Tax charge applies from £50,000 to £60,000 from 6 April 2024 with a reduced taper of loss of allowance. The liability for charges will also be changed so that it is based on a household income rather than on an individual basis to resolve the unfairness of the current system.

  • The CGT annual exempt amount will be reduced to £3,000 from £6,000 as of 6 April 2024.

  • The Dividend nil rate of taxation will be reduced to £500 from £1,000 as of 6 April 2024.

  • The government will create an additional UK Individual Savings Account (ISA) with a £5,000 allowance. This would be in addition to the current ISA subscription limits and will provide an opportunity for people to invest in the UK and to support UK companies. There is no current date for this new ISA.

  • No changes to the ISA subscription limits, however, there are some reforms to the ISA rules announced in the Autumn Statement last year which come into effect from 6 April 2024:

    • The age for opening a Cash ISA is to be increased from 16 to 18.

    • Subscriptions will be allowed to multiple ISA of the same type within the same tax year (except the Lifetime ISA)

    • If you hold an existing ISA that received no contribution in the previous tax year, a fresh ISA application is no longer required.

    • Long-Term Asset Funds will be permitted investments within the Innovative Finance ISA.

    • Open-ended property funds with extended notice periods will be permitted investments within the Innovative Finance ISA.

    • Partial transfers of current year ISA subscriptions between ISA managers will now be allowed.

  • National Savings & Investments (NS&I) will launch a product which will offer consumers a guaranteed interest rate, fixed for three years. The product will be available from early April 2024.

  • From 1 April 2024, personal representatives of estates will no longer need to have sought commercial loans to pay inheritance tax before applying to obtain a ‘grant on credit’ from HMRC.

  • The Furnished Holiday Lettings regime will be abolished from 6 April 2025.

  • Multiple Dwellings Relief, a bulk purchase relief in the Stamp Duty Land Tax regime, will be abolished 1 June 2024.

For more information, the full UK Spring Budget document can be found here: https://www.gov.uk/government/publications/spring-budget-2024

This article isn’t personal advice. If you’re not sure whether a course of action is right for you, ask for financial advice.

catherine alexander
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