It has been impossible to ignore the 2024 Budget – Labour’s first for 14 years – with talk of “black holes” and speculation of steep tax rises from some quarters. It is worth highlighting the key policy announcements made by the Chancellor:

• Employer taxes: An increase in employer National Insurance (NI) contributions to 15% and a reduction in the earnings threshold at which NI payments begin.
• Personal tax: The freeze in the earnings threshold for income tax and NI will end in 2028.
• Capital Gains Tax (CGT): The CGT lower rate was increased from 10% to 18%, and the higher rate from 20% to 24%
• Inheritance Tax: A new 20p rate for shares in Aim-listed companies. Inherited pensions to be taxed. Inheritance tax relief for business owners reduced.

For investors, the change to CGT and the imposition of inheritance tax on pensions may hurt the most long term. The pension change doesn’t come into place until 2027 and by then we’ll have a better understanding of what the rules will really look like.

We know that clients are worried around the pension change in particular, so we will ensure we communicate out to those affected as soon as more details are known.

Any Questions? – If you want help or advice on the best options for you, speak to the team here at Raymond James, Hitchin. Remember, tax treatment depends on individual circumstances and may be subject to change in the future.