Spring Budget 2024 – The leaked and leaky Budget

Spring Budget 2024

The Chancellor managed to find some optimism in the deteriorating economic forecasts, as most Chancellors, of whatever political hue, seem to do before an election. Mr Hunt announced a further 2% cut to national insurance, although it appears that the current budget deficit and the anticipated fall in inflation to 2% did not arrive in time to arm the Chancellor with the fireworks needed to queue an election. With this in mind, the Autumn Statement 2024 is now likely to be the “main event”, if we may, for the Conservatives to bring in a final raft of measures, including perhaps Mr Sunak’s long-forgotten “promise” to slash the basic rate of income tax from 20p to 19p by 2024.

Indeed the speech from Mr Hunt did not feel like a genuine election push; he rather serenaded the opposition and there was an absence of an impassioned pre-election tone. The Conservatives have accepted this election will go very late, or perhaps they have accepted that they will go down with dignity (and cheques that will bounce back).

Whereas in years gone by ministers responsible for leaks to the press resigned on the spot, party politicians have warmly embraced the new age of “populism” and the Budget was leaked, in drips and drabs over the course of the past few days, to various news organisations.

Headlines and commentary as follows…

Spring Budget 2024

Personal taxes

  • Tax Rules for non-UK domiciled individuals – from‌‌‌ 6‌‌‌‌‌‌ April‌‌‌ 2025, the current remittance basis of taxation will be abolished for UK resident non-domiciled individuals. This will be replaced from 6‌‌‌ ‌‌April 2025 with an elective 4-year foreign income and gains (FIG) regime for individuals who become a UK tax resident after a period of 10 years of non-UK tax residence. There will also be transitional provisions for non-doms currently paying tax on the remittance basis, including a 12% tax rate on foreign income arising before April 2025 but brought into the UK in the tax years 2025/26 or 2026/27. Do the Conservatives now feel that the abolition of these breaks will not result in a mass exodus? In practice, looking at the polls and the fairly imminent election, this particular measure won’t be in place before there is a change in government and any actual amendments to the regime are likely to be quite different.
  • High Income Child Benefit Charge (HICBC) – the HICBC income threshold will be raised from £50,000 to £60,000 from 6‌‌‌ April‌‌‌ 2024, and the taper will be extended up to £80,000. A migration to a system based on household rather than individual income is planned by April‌‌‌ 2026.
  • ISAs – introduction of a UK ISA with a new £5,000 allowance, in addition to the existing ISA allowance.

National Insurance contributions – whilst any “tax” cut is welcome, one must recall that the same percentage increase was levied by the same party in order to fund “social care”. Have then, the problems of social care been solved? Or do they no longer matter? The state of our public services will quite possibly be the biggest challenge of the next elected party.

  • Class 1 – a cut to the main rate of Class 1 employee NICs from 10% to 8% from‌‌‌ ‌‌6‌‌‌ ‌‌April 2024.
  • Class 2 & 4 NICs – a further cut of 2 pence to the main rate of Class 4 self-employed NICs from 6‌‌‌ April‌‌‌ 2024, taking this to 6% of profits. The consultation to abolish Class 2 NICs to continue.


  • Capital Gains Tax (CGT) – a reduction to the higher CGT rate for residential property disposals from 28% to 24%. The change will take effect for disposals that take place on or after 6‌‌‌ April 2024. The lower rate of 18% will remain unchanged. For those with second homes, perhaps a “softener” to finance the VAT to be paid on school fees after the election?
  • Furnished Holiday Lettings (FHL) – Were the tax breaks really responsible for exacerbating housing pressures of tourist areas to the detriment of local residents (many of whom also happen to be voters in marginal seats)? Draft legislation to be published in due course, but from April 2025, the generous tax advantages afforded to FHLs operating as either individuals or corporates will be abolished.

Excise and Duties

  • VAT
    • The VAT threshold will increase to £90,000 from 1‌‌‌ April‌‌‌ 2024, and the level at which a business can apply for de-registration will increase from £83,000 up to £88,000. It is good to see the VAT threshold increasing, but we can’t help but ask Mr Hunt: why not go big and move the threshold to say £100,000? We feel that this would move the stifling cliff edge quite some distance for smaller traders; plus, a higher threshold could have taken out a large swath of businesses and reduced demand on HMRC, who are clearly struggling to perform.
    • Also, the VAT implications for the private hire vehicle sector will be examined in April 2024, with potentially full expensing to give 100% corporation deductions for qualifying capital expenditure.
  • Stamp Duty Land Tax (SDLT)
    • First Time Buyers’ Relief will be extended to individuals who use nominee and bare trust arrangements when buying a new lease over a dwelling that they intend to use as their main or only residence.
    • Abolition of Multiple Dwellings Relief, a bulk purchase relief within the SDLT rules available on the purchase of two or more dwellings.
  • Vaping Duty – a new duty on vaping products will be introduced in October 2026, details on the design and implementation to be announced.

Business taxes

  • Energy Profits Levy – the “temporary” tax on oil & gas profits introduced in 2022 has been extended to 1 March 2029. However, alongside this extension is a separate measure which will switch off this tax automatically if the average price for both oil & gas drops below certain thresholds.
  • Creative Industries – New permanent rates of relief (40% and 45%) for theatre, orchestra and museums and galleries exhibition tax, and additional support for independent film through a new UK Independent Film Tax Credit at a rate of 53% for films with budgets under £15 million that meet the conditions of a new British Film Institute test. Plus, a 5% increase in tax relief for UK visual effects costs in film and high-end TV, under the Audio-Visual Expenditure Credit (AVEC).
  • R&D – an expert advisory panel to support the administration of research and development (R&D) tax reliefs.

Tax administration

  • Cryptoasset Reporting Framework (CARF) – the government has launched a consultation to seek views on how best to implement the Cryptoasset Reporting Framework and Amendments to the Common Reporting Standard.

Visit our Budget Highlights and tax data for a summary of the Spring Statement 2024.

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