The Autumn Budget and What the Changes Could Mean for Your Business!

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As the autumn leaves fall, so too do new policies from the Chancellor’s latest budget announcement. We spoke with Helen Gill (née Kirk) , our Senior Client Manager and finance expert, to dive into the details and break down what this Autumn Budget could mean for businesses across the UK. From the increase in the national living wage to major shifts in capital gains and inheritance tax, there’s plenty for business owners and individuals to consider this season.

With a range of impactful measures introduced, it’s clear the government aims to address key economic issues from rising living costs to supporting tax relief strategies for businesses. Grab a cuppa and read on for Helen’s breakdown of the biggest highlights – and find out what might lie ahead for your finances.

Autumn Budget Highlights, Explained!

?? National living wage will increase from 6 April 2025 to ￡12.21 an hour for all employees aged 21 and above. Employees aged between 18 and 20 years old will also have a wage increase to ￡10 an hour

This means:

- More take-home pay for the employees

- Will aid the cost-of-living crisis

?? Capital gains tax rates for all disposals, excluding residential property and carried interest will increase to 18% for the lower rate and 24% for the higher rate for any disposals on or after 30 October 2024.

This means:

- More tax owed to HMRC

- Tax planning with your accountant will be essential to mitigate the tax

?? Exit planning for businesses is changing, with the Business Asset Disposal Relief rate increasing from 10% to 14% in April 2025 and 16% in April 2026

This means:

- Businesses will have more tax payable to HMRC when disposing of businesses

- Timing of the exit planning will be criteria to mitigate the increase in tax rates over the next 2 years

- There is no change to the lifetime limit for this relief, and this remains at ￡1 million

?? Non-domiciled individuals currently do not pay tax in the UK on any foreign income. This will be abolished from 6 April 2025

This means:

- Individuals will have UK tax to pay on any foreign income received

- Non-domiciled Individuals will need to register for self-assessment with HMRC

?? VAT will be charged on all private school fees from 1 January 2025

This means:

- All private schools will need to become VAT registered and have Making Tax Digital (MTD) software in place to be able to submit VAT returns to HMRC

- Individuals will have higher private school fees to pay for their children’s education going forward

?? Employer's National Insurance rates are increasing to 15% from 6 April 2025, with the secondary threshold on when this tax becomes payable being lowered to ￡5,000.

This means:

- Businesses will have more tax payable to HMRC,

- This change will not affect the Employees National Insurance tax rate that employees currently pay; therefore no increase in the employees’ take-home pay

?? Employer's allowance is increasing to ￡10,500 from 6 April 2025

This means:

- Although the Employer's National Insurance rate is increasing, the increase in the allowance will allow more of this tax to be offset before anything is payable to HMRC

- All businesses that are not currently claiming this but may be eligible should complete the HMRC eligibility test online

?? Agricultural land and business assets valued over ￡1 million will incur a 20% inheritance tax rate from 6 April 2026

This means:

- Further tax payable to HMRC on high-value assets, which were not previously included in the inheritance tax calculations

- Review your estate plans to understand the impact of the 50% relief cap on assets above ￡1 million.

- Inheritance tax planning will be essential to mitigate any tax payable

?? The income tax threshold freeze will be removed from April 2028 and will be brought in line with inflation in the 2028/29 tax year

This means:

- Potential increase in employee's take-home pay due to an increase in the thresholds before tax is payable

So, What Does This Mean For You?

While the Autumn Budget brings significant changes, understanding and planning for these shifts can make all the difference in how they impact you and your business. From tax adjustments to new compliance requirements, the landscape is evolving, and staying ahead is key.

If you have questions or need tailored advice on navigating these updates, we're here to help. Reach out to our team at [email protected] to discuss your specific situation and ensure you're prepared for what's next. Let's work together to turn these changes into opportunities.

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