What to Expect from the 2024 Autumn Budget: Preparing for Key Changes
As the UK gears up for the 2024 Autumn Budget, the new Labour government is expected to introduce significant tax changes aimed at raising revenue. For businesses and individuals alike, understanding these potential shifts is essential for proactive financial planning. Below, we’ve highlighted key predictions from wealth planning experts to help you prepare for the upcoming announcements.
- Inheritance Tax (IHT) Reforms
A revamp of the Inheritance Tax system is anticipated. One potential change is the removal of the Residence Nil Rate Band and an increase of the main Nil Rate Band to £500,000 per individual (£1 million for couples). However, to balance these changes, the government may introduce higher tax rates for the wealthiest estates.
- Pension Tax Relief
Reinstating a form of the Lifetime Allowance on pension savings is being discussed, alongside capping tax-free lump sums taken from pensions. The government might also limit tax relief on pension contributions, particularly for high earners, which could significantly impact retirement planning strategies.
- Capital Gains Tax (CGT) and VAT
Changes to Capital Gains Tax and VAT exemptions are also anticipated. Wealthier individuals may face more stringent CGT regulations, while some VAT exemptions could be reduced or removed to increase revenue.
- National Insurance and Other Taxes
Experts suggest that we could see National Insurance contributions (NICs) charged on pension income, and potentially higher NICs for employers making significant pension contributions.
- Taxation on Private Equity
Reforms to how private equity carried interest is taxed could mean higher rates, aligning capital gains tax with income tax for certain investors.
How to Prepare
With these potential changes on the horizon, now is the time to review your financial strategy. Whether you’re concerned about pension planning, inheritance tax, or business tax implications, being proactive is key. Reach out to us at Practical Business Solutions to discuss how the Autumn Budget might affect you and explore ways to optimise your tax position ahead of these changes.
For more in-depth analysis or to schedule a consultation, feel free to contact us.
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