On the 30th of October, the Chancellor Rachel Reeves announced the 2024 Budget.

Key measures that will affect individuals across the country:

• National living wage rising by 6.7% to £12.21 per hour.
• Working-age benefits increasing by 1.7% in line with inflation.
• State pension rising by 4.1% under Triple Lock.
• CGT rates increasing to 18% and 24%.
• IHT thresholds frozen until 2030.
• Fuel duty freeze and 5p cut extended for 12 months.
• £1bn extension to Household Support Fund.
• Carer’s allowance earnings limit increased significantly.
• Universal Credit debt repayments capped at 15%.

For self employed, there are no tax increases. However, the interest rate HMRC charge on late payments has increased from 7.75% to 9% from the 6th of April 2025 so paying your tax on time is imperative.

However limited company owners with one director, will see an increase of £657 in Employers National Insurance which has increased by 2%, up to 15%.

There were also changes to the Capital Gains Tax regime, with Business Asset Disposal Relief increasing to 14% as of the 6 April 2025 and 18% as of 6 April 2026 which will affect business owners looking to exit from their businesses over the next few years.

In the Inheritance Tax space, unused pension pots are being brought into Inheritance Tax Calculations (these are currently exempt) from April 2027.

The small business support measures from Labour are focused around encouraging small business owners to take loans from the British Business Bank, without explaining that should your business close, the loan is still payable by you personally. It is not the solution. If you are starting a business it is so important to spend the time at the start planning the business and understanding how long it will take you to break even from it, when you will need to hire staff, and what set up costs are involved before you hit the go button.

Get in touch with us to help with your business and tax planning.