The Chancellor has announced his financial update. Here are the key points that Jeremy Hunt raised:
Savings
- New ‘British ISA’ permitting an additional £5,000 annual investment allowance for investments in the UK equity.
- New British savings bond through NS&I – fixed interest rate for 3 years.
Property Tax
- Reduce the higher rate of property capital gains tax from 28% to 24%.
- Abolish stamp duty relief for people purchasing more than one dwelling in one transaction.
National Insurance
- There has been a cut of 2p on National Insurance from April 2024.
Child Benefit
- The threshold for childcare benefits will increase from £50,000 to £60,000 and the top of the taper at which it is withdrawn will increase to £80,000. Introducing a household-based system rather than an individual-based system in 2026.
Business Tax
- Amount businesses can earn before registering for VAT to increase from £85,000 to £90,000.
Growth
- Office for Budget Responsibility expect economy to grow by 0.8% this year and 1.9% next year.
- Debt to fall to 94.3% of GDP by 2028-2029.
Inflation
- When the chancellor Came to office inflation was at 11%, which is now 4%. OBR forecast shows below 2% in just a few months’ time.
Government Borrowing
- Debt relief orders previously cost £90 now no cost.
- Debt to fall to 94.3% of GDP by 2028-2029.
Other measures introduced
- Household support fund extended.
- Debt relief orders previously cost £90 now no cost.
- DC pension funds must show level of investment in UK equities.
- Extend windfall tax on the profits of oil and gas companies until 2029.
- Abolish non-dom tax regime.
- Alcohol duty freeze – extended until February 2025.
- Fuel duty 5p cut – extended until February 2025.
If you would like to discuss any of these budget updates with one of our Financial Advisers, please get in touch with us.