Autumn Budget 2024

How much income can you receive before paying tax?

  • 2024/25 tax year – £12,570 p.a.
  • You start to lose this allowance when annual income exceeds £100,000
  • These thresholds will remain unchanged for the 2025/26 tax year but should be reviewed in 2028

 How much income can you receive before paying higher rate tax (40%)?

  • 2024/25 tax year – £50,270 p.a.
  • This threshold will remain unchanged for the 2025/26 tax year but should be reviewed in 2028

 How much income can you receive before paying additional rate tax (45%)?

  • 2024/25 tax year – £125,140 p.a.
  • This threshold will remain unchanged for the 2025/26 tax year but should be reviewed in 2028

 How much dividend income can you receive before paying tax?

  • 2024/25 tax year – £500 p.a.
  • This threshold will remain unchanged for the 2025/26 tax year

Tax on Dividends

  • Basic rate taxpayers pay 8.75%
  • Higher rate taxpayers pay 33.75%
  • Additional rate taxpayers pay 39.35%

How much interest can you receive before paying tax?

  • Basic rate taxpayers – £1,000 p.a.
  • Higher rate taxpayers – £500 p.a.
  • Additional rate taxpayers – £0 p.a.

National Insurance Contributions (NICS)

  • From April 2025 Class 1 Employer NICS will be increase from 13.8% to 15%

Capital Gains Tax (CGT)

  • The Annual tax exempt Amount of CGT for individuals is £3,000 for the 2024/25 tax year
  • From today , basic rate taxpayers pay 18%
  • From today, higher rate taxpayers pay 24%

Inheritance Tax (IHT)

  • The Inheritance Tax nil-rate band will remain at £325,000 per person until April 2030
  • The residence nil-rate band will remain at £175,000 until April 2030
  • The residence nil-rate band taper will continue to start at £2 million
  • It has been proposed that from April 2027, inherited pension funds will be subject to inheritance tax. Details to follow…

ISA contribution limits

  • The 2024/25 annual ISA limit is £20,000
  • The 2024/25 Junior ISA annual limit is £9,000
  • These limits will remain unchanged for the 2025/26 tax year
  • The proposed “British ISA” has been scrapped
  • Government has committed to keep these limits at least until April 2030

Pensions

  • Please see amendments to Inheritance Tax rules above.
  • Maximum Pension Commencement Lump Sum (“Tax Free Cash”) is frozen at £268,275.
  • Annual Allowance for gross pension contributions is £60,000.
  • roughly… Once total income plus pensions exceeds £260,000 p.a. the annual gross pension input allowance starts to reduce. If total income plus pensions is £360,000 or more, the annual gross pension input allowance is limited to £10,000. (Carry Forward may be an option.)
  • The Money Purchase Annual Allowance for those who have flexibly accessed their pensions is £10,000. You can contribute £10,000 (gross) in a tax year, even if you have previously “flexibly” accessed a pension. You still need to earn at least £10,000 for this to work.

Stamp Duty

  • Stamp Duty Land Tax on second homes is increasing from 3% to 5% from 31st October 2024

This post is intended as information only and does not constitute advice in any way.  The information contained herein could be wrong or may have changed by the time you read it so should not be relied upon in any way.