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What the 2024 Spring Budget Might Mean For You

Having a Good Understanding of the Opportunities and Threats Will Help You Make the Most Out of the UK Tax Regime


Whilst the March 2024 Budget didn’t contain much by the way of surprises from a personal financial planning perspective it is worth recapping the key points, as well as summarising what has remained unchanged.




The ISA allowances will remain unchanged at £20,000 for adult ISAs and £9,000 for Junior ISAs.


A new “UK ISA” is to be introduced to boost UK investment.


This will give an extra allowance of £5,000 on top the existing £20,000 limit. It won’t happen immediately though. Consultation will be open until 6 June 2024.


Any growth or income that builds up within your ISA portfolio is extremely tax efficient. For those households who have the financial means to save and invest over a sustained period of years, it is possible to build up a substantial six or even seven-figure tax-sheltered portfolio.




No new changes were announced, which is to be welcomed. The Lifetime Allowance (what you can build up tax-efficiently) is still being abolished from 6th April 2024. The pension Annual Allowance (what you can pay in tax-efficiently) remains at £60,000 p.a.


As is already the case, very high earners will still see this reduced, down to a minimum of £10,000, under the Tapered Annual Allowance rules. 


Pensions continue to be a very generous investment vehicle given than not only can you receive a generous tax break on money that you pay in, but you can also benefit from very tax-efficient returns on a year-by-year basis. Furthermore, the tax treatment of the fund on death remains generous too.




There were no major changes. The inheritance tax nil rate band stays at £325,000, with a further £175,000 for the residence nil rate band.


The current rules favour married homeowners with children and grandchildren (which can feel unfair), but if you are eligible for the full £175,000 residence nil rate band, a couple can pass up to £1 million of assets down the generations, completely free from inheritance tax.




The Chancellor announced a further 2% cut to the main employee’s rate of NI, starting from 6th April 2024. This is on top of the 2% cut announced in the Autumn Statement and targets the working population.


The new rate of 8% will apply to earnings between the primary earnings threshold and the upper earnings limit, giving a maximum saving of £754 p.a. Employer’s NI will remain unchanged at 13.8%.


The point at which you pay 40% income tax (income over £50,270 p.a.) and 45% tax (income over £125,140 p.a.) will stay the same.


The dividend allowance dropped from £2,000 in 2022/23 to £1,000 in 2023/24 and will fall again to just £500 in 2024/25. This had already been announced. The dividend tax rates for basic rate, higher rate and additional rate taxpayers will remain at 8.75%, 33.75% and 39.35% respectively.




Child Benefit is currently £24 per week for the only or eldest child and £15.90 per week for additional children.


The eligibility for this is currently based on the income of the highest earner in a household and is withdrawn at the rate of £1 for every £100 of earnings they have over £50,000. This means that once the higher earner’s income exceeds £60,000, the High Income Child Benefit Charge, equals the Child Benefit. In other words, you don’t get Child Benefit.


From April 2024, the threshold will increase from £50,000 to £60,000, and the rate at which it is withdrawn will be £1 for every £200 of income.


In practice, this means that Child benefit will therefore only be lost once the highest earner's income exceeds £80,000.


Pension contributions remain a good way of retaining some or all of your Child Benefit.


There are plans to make the system fairer, to look at household income as a whole rather than at just the higher earner, and the government aims to introduce this by April 2026.




The Chancellor also announced that NS&I (National Savings & Investments) will launch a British Savings Bond product, with a three year fixed rate.  This will be made available in April 2024. We don’t yet know what the interest rate will be.




The capital gains tax allowance dropped from £12,300 in 2022/23 to £6,000 in 2023/24 and will fall again to just £3,000 in 2024/25.


At present, CGT is charged at 10% for basic rate taxpayers and 20% for higher rate taxpayers.


However, when the gain relates to the sale of a residential property (which isn’t your main residence), the rates are 18% and 28% respectively. The higher residential property CGT rate is to be cut from 28% to 24% from 6 April 2024 to encourage more property sales.




The understandable challenge for many households is working out how best to fund their present, not their future.

But if you are already in the positive position of having built up savings and investments or have the means to be able to do so going forward, generous opportunities exist within the UK’s personal finance landscape.


If you would like impartial help thinking through what you can do to plan your own financial future, please call us on 020 3488 9505.

The value of your investments can go down as well as up, so you could get back less

than you invested.

Tax and Estate planning is not regulated by the Financial Conduct Authority.


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