Autumn 2024 UK Budget: Key
Insights for Business Owners

Autumn 2024 UK Budget: Key Insights for Business Owners

Autumn 2024 UK Budget: Key Insights for Business Owners

The Autumn 2024 UK Budget, presented by Chancellor Rachel Reeves, introduced a range of measures impacting businesses of all sizes. From taxation reforms to support schemes, the changes aim to address fiscal sustainability while influencing investment and operational decisions. Below, we break down the key announcements most relevant to business owners.


Taxation Changes Affecting Businesses

1. Capital Gains Tax (CGT)

  • Rate Increases:

    • The lower and higher CGT rates have risen to 18% and 24% (from 10% and 20%), effective immediately.

    • By April 2026, taxes on qualifying business asset disposals and investors’ relief will increase to 18% from the current 10%.

  • Impact: Business owners planning asset sales may face higher tax liabilities and should evaluate the timing of transactions.


2. Inheritance Tax (IHT)

  • Business and Agricultural Property Relief:

    • Tax-free threshold reduced to £1 million; amounts above this are eligible for only 50% relief.

    • Affects agricultural land and qualifying shares (e.g., AIM-listed companies).

  • Defined Contribution Pensions:

    • From April 2027, these pensions will be included in IHT assessments, potentially affecting estate planning.

  • Threshold Freeze: The IHT nil rate band of £325,000 remains frozen until 2030.


3. Employer National Insurance Contributions (NICs)

  • Rate increased from 13.8% to 15%.

  • The threshold for contributions has been reduced from £9,100 to £5,000.

  • Employment Allowance: Relief increased from £5,000 to £10,500, benefiting small businesses.


4. VAT and Business Rates

  • Private Schools:

    • From January 2025, VAT will apply to private school fees.

    • From April 2025, private schools will lose charitable relief on business rates.


5. Other Key Tax Adjustments

  • Stamp Duty Land Tax: The surcharge for purchasing additional properties increased from 3% to 5%, effective immediately.

  • Energy Profits Levy: Increased from 35% to 38% from November 2024, with investment allowances abolished.

  • Non-Dom Regime: Abolished from April 2025, replaced with a residence-based tax system.


Incentives and Support for Businesses

1. Employment Allowance

Small businesses can now claim up to £10,500 in NIC relief, providing significant savings for employers.


2. Research & Development (R&D) Tax Credits

Enhanced support for innovation in technology and green initiatives was confirmed, encouraging investment in these sectors.


Regulatory and Compliance Changes

  • Modernized HMRC Systems:

    • Increased investment in compliance and debt collection technology.

    • Higher interest rates on overdue tax payments to encourage timely filings.


Sector-Specific Updates

  • Retail & High-Street Businesses:

    • Continuation of targeted business rate reliefs to support small, independent shops.

  • Real Estate:

    • Second-property investors face higher stamp duty surcharges, prompting a reevaluation of property portfolios.


What This Means for Your Business

This budget signals a mix of challenges and opportunities for business owners:

  • Rising NICs and CGT rates could increase operational costs and reduce after-tax profits.

  • However, enhanced Employment Allowance and R&D credits provide relief and incentives for growth.

Action Steps:


  • Reassess financial and succession planning strategies.

  • Consult a tax advisor to leverage reliefs and navigate the new regulatory landscape.


For tailored advice on how these changes impact your business, contact us at admin@gbmaccounting.co.uk, your trusted partner in navigating fiscal policy shifts.