The Chancellor delivered her Autumn Budget today. In a speech that was well over an hour she detailed the Government’s approach to restoring stability to public finances and to restoring public services. Ms Reeves covered the difficult decisions she has taken on tax and we provide the Autumn Budget headlines below.
Employment Taxes
- Rate of Employers National Insurance Contributions increased by 1.2% to 15% from April 2025
- Reduced the secondary threshold from £9,100 to £5,000
- Increase the Employment Allowance from £5,000 to £10,500, allowing the smallest companies to employ the equivalent of 4 full-time workers on National Living Wage without paying any National Insurance
Capital Gains Tax
- Lower rate of Capital Gains Tax increased from 10% to 18% with immediate effect
- Higher rate of Capital Gains Tax increased from 20% to 24% with immediate effect
- Rates of Capital Gains Tax on residential property maintained at 18% and 24%
- Lifetime limit for Business Asset Disposal Relief (BADR) maintained at £1m
- BADR will remain at 10% this year before rising to 14% in April 2025, and 18% from 2026/7
- Enterprise Investment Scheme and Venture Capital Trust Schemes extended until 2035
Inheritance Tax
- Inheritance tax thresholds frozen until 2030
- Close the loophole created when the Lifetime Allowance was abolished by bringing inherited pensions into Inheritance Tax from April 2027
- Reform Agricultural Property Relief and Business Property Relief. From April 2026 the first £1m of combined business and agricultural assets will continue to attract no inheritance tax at all. For assets in excess of £1m, Inheritance Tax will apply with a 50% relief at an effective rate of 20%
- 50% relief will apply in all circumstances on Inheritance Tax for shares on the Alternative Investment Market
Business Rates
- From 2026/7 introduce two permanently lower tax rates for Retail, Hospitality and Leisure businesses, to be paid for by a higher multiplier in the most valuable properties
- 40% relief on business rates for  Retail, Hospitality and Leisure industry for 2025/26 up to a cap of £110,000 per business and the small business tax multiplier frozen next year
Corporation Tax Road Map
- Commitment to cap Corporation Tax at 25% for the duration of this Parliament (2029)
- Full expensing maintained
- Retaining £1m Annual Investment Allowance
- Maintaining current rates of Research and Development Relief
Stamp Duty Land Tax
- Increasing Stamp Duty Land Tax surcharge for second homes (the higher rate for additional dwellings) by 2% to 5%, effective from 31 October 2024
The Chancellor believes the measures she has set out are the right choices for the economy, acknowledging that they are not easy choices, but they are responsible ones.
We will be looking at the detailed documentation that accompanies the Budget over the coming days.
As always, you are reminded that this article is generic in nature and you should take no action based upon it without consulting your professional advisor.
Related Blogs:
What are we expecting in the Autumn Budget 2024? | Bates Weston
Autumn Budget: Employers National Insurance | Bates Weston
Inheritance Tax, Business Property Relief and the Autumn Budget | Bates Weston
