Spring 2024 Budget Summary

On Wednesday 6 March 2024, Chancellor of the Exchequer Jeremy Hunt presented his Spring Budget to Parliament, billed as a “Budget for Long Term Growth”. The fiscal address introduced notable personal tax cuts alongside major structural reforms to property taxation and non-domiciled tax status.

Our advisory team has summarised the key announcements and their practical implications for businesses, landlords, and individual taxpayers.

National Insurance Cuts

Building upon reductions introduced in the Autumn Statement 2023, the Chancellor announced further cuts to National Insurance contributions (NICs) taking effect from 6 April 2024:

• Employees: The main Class 1 employee NIC rate was cut by a further 2 percentage points, from 10% to 8%.
• Self-Employed: The main Class 4 rate was reduced from 8% to 6%, providing additional relief alongside the abolition of compulsory Class 2 contributions.

Property Taxation & Letting Relief

The Chancellor introduced targeted adjustments to property taxation:

• Residential Capital Gains Tax: The higher rate of Capital Gains Tax on residential property gains was reduced from 28% to 24% to encourage property transactions. The basic rate remains at 18%.
• Furnished Holiday Lettings (FHL): The preferential tax regime for Furnished Holiday Lettings will be abolished from April 2025, aligning short-term holiday rentals with standard residential property lettings for tax purposes.
• Multiple Dwellings Relief (MDR): Stamp Duty Land Tax (SDLT) Multiple Dwellings Relief in England and Northern Ireland was abolished for transactions completing on or after 1 June 2024.

High Income Child Benefit Charge (HICBC)

To address the “cliff-edge” effect of the High Income Child Benefit Charge, the threshold at which the charge begins was increased from £50,000 to £60,000 from April 2024. The taper rate was halved so that benefit is only fully withdrawn once income reaches £80,000.

Non-Domiciled Tax Status Replaced

The long-standing remittance basis of taxation for non-UK domiciled individuals is to be abolished from 6 April 2025 and replaced with a modernised residence-based regime. Under the new rules, new arrivals to the UK will pay no UK tax on foreign income and gains for their first four years of tax residence.