[UK] Spring Budget 2024: what you need to know

In the UK, Chancellor of the Exchequer Jeremy Hunt has unveiled the spring budget for 2024, The Guardian summarises his key announcements.

Mr Hunt opened the budget by stating that the UK economy has dealt with the impacts of the financial crisis, the pandemic and the energy crisis caused by war in Europe.

The chancellor acknowledged that interest rates “remain high as we bring down inflation” and reportedly called this a “budget for long-term growth”.

His most significant announcements included:

National insurance

• The chancellor confirmed that the national insurance contribution rate will be cut from 10 per cent to 8 per cent of pay from April.
• This is in addition to a 2p cut in the autumn statement in November, which reduced the rate from 12 per cent to 10 per cent.
• It is reportedly estimated that the 2p NI cut would be worth around £450 a year for someone on a £35,000 full-time salary.

Non-dom tax status

• Mr Hunt also confirmed that non-dom tax status will be “abolished” and replaced by a “modern, simpler and fairer” system from April 2025. The status belonged to people who live in the UK but have specific overseas links, often reportedly determined by whether their father was born abroad. 
• The status means that those eligible pay UK tax on money earned here, but not on their global income. After four years, those coming to the UK will pay the same tax as other UK residents.

Child benefit

• The chancellor announced a consultation on child benefit rules, to apply it to collective household incomes rather than to individuals from April 2026. 
• The threshold for a high-income tax charge on the benefit will reportedly be raised from £50,000 to £60,000. 
• The top of a taper to withdraw the benefit will be raised to £80,000 from the current £60,000.

Economy

• Mr Hunt said he intends to allow full expensing to apply to leased assets. Full expensing allows businesses to offset investment in items such as new factory machinery and IT equipment against tax.
• The VAT registration threshold will be increased from £85,000 to £90,000 from the start of April, the chancellor reportedly said this would help “tens of thousands of businesses”.

​​Inflation

• Inflation is expected to fall below the government’s 2 per cent target in “...just a few months’ time”, Mr Hunt said, dropping from 4 per cent in January. This comes, “Nearly a whole year earlier than forecast in the autumn statement,” he said.
• The Bank of England’s long-term target is to keep inflation at a “low and stable” 2 per cent.

Source: The Guardian

(Quotes via original reporting)

In the UK, Chancellor of the Exchequer Jeremy Hunt has unveiled the spring budget for 2024, The Guardian summarises his key announcements.

Mr Hunt opened the budget by stating that the UK economy has dealt with the impacts of the financial crisis, the pandemic and the energy crisis caused by war in Europe.

The chancellor acknowledged that interest rates “remain high as we bring down inflation” and reportedly called this a “budget for long-term growth”.

His most significant announcements included:

National insurance

• The chancellor confirmed that the national insurance contribution rate will be cut from 10 per cent to 8 per cent of pay from April.
• This is in addition to a 2p cut in the autumn statement in November, which reduced the rate from 12 per cent to 10 per cent.
• It is reportedly estimated that the 2p NI cut would be worth around £450 a year for someone on a £35,000 full-time salary.

Non-dom tax status

• Mr Hunt also confirmed that non-dom tax status will be “abolished” and replaced by a “modern, simpler and fairer” system from April 2025. The status belonged to people who live in the UK but have specific overseas links, often reportedly determined by whether their father was born abroad. 
• The status means that those eligible pay UK tax on money earned here, but not on their global income. After four years, those coming to the UK will pay the same tax as other UK residents.

Child benefit

• The chancellor announced a consultation on child benefit rules, to apply it to collective household incomes rather than to individuals from April 2026. 
• The threshold for a high-income tax charge on the benefit will reportedly be raised from £50,000 to £60,000. 
• The top of a taper to withdraw the benefit will be raised to £80,000 from the current £60,000.

Economy

• Mr Hunt said he intends to allow full expensing to apply to leased assets. Full expensing allows businesses to offset investment in items such as new factory machinery and IT equipment against tax.
• The VAT registration threshold will be increased from £85,000 to £90,000 from the start of April, the chancellor reportedly said this would help “tens of thousands of businesses”.

​​Inflation

• Inflation is expected to fall below the government’s 2 per cent target in “...just a few months’ time”, Mr Hunt said, dropping from 4 per cent in January. This comes, “Nearly a whole year earlier than forecast in the autumn statement,” he said.
• The Bank of England’s long-term target is to keep inflation at a “low and stable” 2 per cent.

Source: The Guardian

(Quotes via original reporting)