What does the Autumn Budget mean for SME’s?
On 30th October 2024, Rachel Reeves delivered the Autumn Budget, titled ‘Fixing The Foundations To Deliver Change’. What will this mean for you and your business?
We highlight the key points below:
Personal Tax
- Freeze on income tax and National Insurance thresholds to end in 2028, preventing people from being dragged into higher tax bands as their wages rise
- Capital gains tax paid on profits from selling shares to increase from up to 20% to up to 24% - rates on additional property sales to stay same
- Freeze on inheritance tax thresholds extended beyond 2028 to 2030
Employment
- Legal minimum wage for over-21s to rise from £11.44 to £12.21 per hour from April
- Rate for 18 to 20-year-olds to go up from £8.60 to £10, as part of a long-term plan to move towards a "single adult rate".
- Firms to pay National Insurance on workers’ earnings above £5,000 from April, down from £9,100 currently, with the rate increasing from 13.8% to 15%.
Business
To increase business investment, the government has announced several measures.
- Employment allowance - which allows companies to reduce their NI liability - to increase from £5,000 to £10,500.
- Tax paid by private equity managers on share of profits from successful deals to rise from up to 28% to up to 32% from April.
- Main rate of corporation tax, paid by businesses on taxable profits over £250,000, to stay at 25% until next election.
- Full Expensing remains permanent.
- The 75% discount to business rates which is due to expire in April 2025 will be replaced by a discount of 40% – which applies up to a maximum £110,000 per business.
- The Annual Investment Allowance, which gives a 100% write-off on certain types of plant and machinery, remains at £1 million per 12-month period.
- Maintain the current rates of R&D tax relief, allowing businesses to continue to claim a portion of their research and development investments.
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2024