Spring Budget 2024: What It Means for Employers

The Chancellor of the Exchequer, Jeremy Hunt, announced the 2024 Spring Budget to Parliament earlier today. Hunt had a focus on helping families with the cost of living through permanent tax cuts, while acknowledging the economic difficulties the UK has faced from the war in Europe.

It can be hard to sift through the noise and pinpoint which parts of the announcement will have the biggest impact on your clients. There were a lot of changes in this Spring Budget, some of which included cuts to National Insurance rates, VAT registration thresholds and Property Capital Gains Tax.

We’ve summarised some of these points for you which you can easily share with your clients. That way, they can see how this year’s Spring Budget may directly affect their businesses, without having to search through twenty different webpages.

National Insurance cuts

The biggest change in the announcement was the National Insurance rate cuts. National Insurance contributions will be reduced by 2%. This will mean that from the 6th of April, NI contributions will fall from 10% to 8%. This reduction will affect about 27 million people and should save someone who’s on an average annual income of £35,000 roughly £450 each year.

Changes to Property Tax

The higher rate of Property Capital Gains Tax on residential properties will be reduced by 4% from April 2024. This means the higher rate will drop from 28% to 24%. On top of that, Stamp Duty Relief for those buying more than one property is set to be abolished.

VAT registration changes

If you have clients that were looking to register for VAT, the thresholds have changed. The threshold for VAT registration will rise from £85,000 to £90,000. This will mean that roughly 28,000 small businesses will no longer have to pay VAT.

Changes to fuel costs

If you have clients who spend a lot of time on the road, then this is something they should be aware of. Fuel duty is set to remain at its current rate and will be frozen until March 2025. The 5p fuel cut that was meant to be temporary will also remain in place, which means that fuel costs will stay at 53p per litre. This is a step in the right direction when it comes to the cost of living crisis, with aims to save the average driver roughly £50 next year

To see the full list of changes, check out gov.uk’s website.

This content may have been developed with the assistance of AI tools. Content is reviewed by a member of the Bright team before publication. Guidance on legislation can be obtained from your industry body.