A Tough Autumn Budget for Businesses: 2024
30th October 2024
The Autumn 2024 Budget has been a tough Budget for businesses, but it perhaps hasn’t provided too many surprises given the recent press announcements. Below we share our key takeaways for businesses…
Corporation Tax
For those Limited Companies, there is confirmation of the main rate of Corporation Tax remaining at 25% for the duration of the current Parliament, with no changes to the small companies’ rate of 19% for those companies that qualify for such.
Capital Allowances, R&D & The Cost of Employees
There is also confirmation that the rates for capital allowances will remain as before, including main pool assets, annual investment allowances and for full expensing. These announcements are all very good news for all businesses. Also in terms of Research and Development the rates and conditions of such will remain for those companies that qualify.
However, the costs that a business will incur, whether this is for companies, partnerships or sole traders, on the cost of their employees will increase, with the increase of the National Living Wage to £12.21 per hour from April 2025. In addition, there is to be an increase of employers’ National Insurance to 15% from April 2025, however at the same time the level at which this charge becomes payable reduces from £9,100 to £5,000.
Late Paid Tax
Many businesses and individuals have issues with cash flow, and sometimes this does result in tax being paid late with amounts owed to HMRC, this has been recognised as an issue, however from the view that everyone should ensure that they pay the correct amount of tax, and that non-compliance will be punished, there will be further confirmation as to what this will entail in the forthcoming weeks.
Business Relief
Continued business relief will be provided for those within the retail, leisure and hospitality sector, with further rates being introduced.
Capital Taxes
For many of our small business clients the announcements relating to both of the capital taxes will mean that there is to be careful consideration to succession and indeed the sale of those businesses, with increases in the rates of Capital Gains Tax (CGT) for both business and non-business assets, with a higher rate of CGT of 24% from April 2025 and Business Asset Disposal Relief of 18% from April 2026.
Inheritance Tax Relief
In terms of Inheritance Tax relief, the changes from April 2026 to both agricultural property and business property relief are perhaps going to provide future challenges where the value of the assets in question exceed both the nil rate band and also a newly introduced level of £1 million. The details of these complex reliefs will become clearer in the next few weeks.
Stamp Duty Land Tax (SDLT)
Finally, for Stamp Duty Land Tax, there will also be an immediate increase in the SDLT surcharge from 3% to 5% from 31 October 2024 on the purchase of second residential properties.
Double Cab Pick-up Vehicles
As was sign-posted earlier in the year, double cab pick-ups with a payload of one tonne or more will be taxed the same as cars (For corporation tax capital allowance purposes wef 1 April 2025, and for income tax benefit in kind purposes wef 6 April 2025).
2024 Autumn Budget Summary:
Get In Touch
It’s a tough Budget for businesses, but rest assured that Whitings LLP are here to help you.
For advice and guidance on your particular circumstances following the Autumn Budget, contact your local Whitings LLP office today.
