6 Frequently Asked Questions About Budget Day 2024

If you’ve been following our Autumn Budget 2024 blogs, you’ll know we have plenty of content lined up for you over the next couple of weeks in the run-up to the big day. With it being Labour’s first budget since coming into power earlier this year, everyone is set for some stark changes up ahead. With so much speculation surrounding what exactly will be covered, we’ve had our eyes and ears open to gather as much intel as we can to share with you and appease worries.  

We’ve created a list of the most common FAQs circulating at the moment with the hope of addressing your concerns and clarifying any potential impacts.  

How can I watch the Autumn Budget? 

The budget will be delivered by Chancellor Rachel Reeves on Wednesday 30^th October shortly after 12.30pm. Expecting to last approximately 1 hour, the speech will be broadcast live on BBC, BBC News website, and streamed on Parliament TV. 

How quickly do the changes take effect?   

Any budget changes announced can be implemented on different dates. While it’s possible some may take effect straight away, they are normally just ‘accepted’ on the day. MPs will spend several days discussing and debating plans before approving proposals, so it takes some time to officially turn tax measures and policies announced into law.  

What will be addressed?  

This is perhaps the most frequently asked question, and one which we don’t have a full answer to. However, with Labour’s outlined commitment to priorisiting growth, it is likely that the majority of changes will relate to expanding and boosting the economy. For a detailed plan on how they will go about this, we’ll have to wait until the 30^th to see. That being said, announcements that have already been made are a good indication of incoming changes, for example when it comes to tax. Income tax, VAT and Employee’s NI are in the safe zone, leaving others open for changes (see below). 

Are there likely to be tax increases?

The simple answer is yes, it’s likely. With there being so much talk about the concerning state of the UK’s finances – and since income tax, VAT and EE NI are confirmed as off the table – speculation has been rising about which taxes will be increased to generate the much-needed revenue. There are concerns that Capital Gains Tax (CGT) will see a significant rise more closely aligned with income tax. This would of course have a large impact on individuals and small business owners looking to sell assets, shares, or the business itself. 

Inheritance Tax (IHT) could also be a contender which, if applicable, may also have a knock-on effect on Agricultural Property Relief (APR) and Business Property Relief (BPR). As it stands, both relief types are instrumental in small family businesses and farms being able to pass assets without large taxes applied. 

Any small businesses looking to close may feel the impact of potential reductions or restrictions when it comes to Business Asset Disposal Relief (BADR) which currently allows them to reduce the rate of CGT they pay. 

What’s more, Labour has recently come under scrutiny after sidestepping direct questions about Employer’s National Insurance (ER NI). While Employee’s National Insurance will not be increased, in line with their pledge not to increase taxes on ‘working people’, some are starting to wonder if higher rate and additional rate taxpayers are excluded from this.  The current rate of ER NI is 13.8%, but we might see a rise sooner rather than later. 

Will there be a change to pensions?  

Long-term retirement planning could be affected if the upcoming budget introduces a flat tax relief to replace the current system. This would mainly impact higher earners who at present can receive up to 45% in pension tax relief.   

How can I prepare/What’s the best way to protect my business ahead of budget day? 

Being told to stay ahead of tax changes is all well and good, however, the last thing you want to do is make rash decisions based off rumours that could end up harming instead of helping your business. The best thing we could advise to do in the face of potential changes is to start thinking and carefully mapping out a longer-term plan or strategy. That way, you’re more aware of what changes will affect you and your business.  For example, you may find it useful to start reviewing your assets or looking at ways to maximise your pension contributions. 

Got more questions? 

You’re in the right place! We’ll be publishing lots of content in the lead-up to budget day so make sure to check back on our website and follow us on socials for updates. In the meantime, you can get in touch with our team and we’ll answer your questions as best we can.