Here are the main points:
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Income Tax Adjustments: The income tax thresholds are frozen until April 2028, impacting personal allowances and higher-rate thresholds. This continued freeze, amid inflation, will likely affect take-home pay for many workers.
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VAT on Private Schools: VAT on private school fees, set to start in January 2025, will now exclude specific areas like TEFL courses. Non-maintained special schools (NMSS) are included, though they can reclaim VAT due to their funding source.
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National Insurance and Wages: Starting April 2025, the National Living Wage for those aged 21+ will rise to £12.21 per hour, while the National Minimum Wage rates will see a significant boost. Employers will also face a 1.2% increase in National Insurance contributions, raising the rate to 15%, with adjustments in the threshold and employment allowances for eligible businesses.
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Energy Transition Investment: The government has announced increased investment in energy transition projects, including funding for nuclear power and renewable energy initiatives to support the UK’s net-zero goals.
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Corporate Tax Credits and Crypto Reporting: Corporate tax relief will be available to encourage investment in innovation, especially within small and medium enterprises. A new crypto asset reporting framework will also be introduced to increase transparency and combat tax evasion.
These policies reflect a balanced approach to strengthening the public purse while aiming to address the cost-of-living challenges.
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