Month: October 2024

The Autumn Budget 2024

Chancellor Rachel Reeves delivered her Budget on Wednesday 30 October 2024. She pledged to ‘invest, invest, invest’ to drive growth and ‘restore economic stability’.

Billions in tax rises

Ms Reeves said the Budget will raise £40 billion in taxes. Employers’ National Insurance contributions (NICs) will be increased from next April while Capital Gains Tax rates will also rise. Inherited pensions will fall within the Inheritance Tax net from April 2027 while reliefs will be reformed on the passing down of agricultural and business assets. The Chancellor also confirmed the introduction of VAT on private school fees and the abolishment of the tax regime for non-UK domiciled individuals.

We are pleased to enclose a copy of our Autumn Budget 2024 which summarises the main points relating to taxation in the Chancellor’s speech.

We hope the summary will provide you with a useful update and allow you to get to grips with the changes. If you have any questions in understanding how the changes to tax affect you, please do get in touch.

MTD for Income Tax – A reminder of what’s to come

Due to a lack of updates from HMRC, you would be forgiven for thinking that the brakes had been applied to the rollout of MTD for Income Tax. You would be wrong! 

Despite the uncertainty surrounding the implementation of this new digital scheme, HMRC is still pressing ahead. This is what we know so far:

  • The scheme will apply to self-employed individuals and property landlords.
  • Phase 1 – from April 2026 – applies to those with an annual income of £50,000 a year or more.
  • Phase 2 – from April 2027 – applies to those with an annual income between £30,000 and £50,000.
  • The tax year dates remain unchanged.
  • MTD for Income Tax also applies to self-employed individuals who must comply with MTD for VAT.

Regardless of which date the taxpayer enters the scheme, the compliance process is as follows:

  • All income and expense information must be recorded and submitted digitally every quarter using HMRC approved MTD for Income Tax compatible software.
  • Taxpayers must make any accounting adjustments or allowances to their digital records.
  • The Final Declaration, which replaces the Self Assessment part of the return, must be filed, and any tax due should be paid by 31 January after the end of the tax year.

No announcements have been made regarding how or when individuals earning less than £30,000 a year or partnerships will be required to join the scheme.

We will let you know if any changes are made to the timings or the eligibility criteria.