The Spring budget speech highlighted a mix of practical policies and tax changes aimed at supporting economic recovery and sustainable growth.
The Chancellor Jeremy Hunt recently delivered his Spring Budget. He unveiled some changes that will influence your finances and may also affect your decision as to which party to vote for in the general election which will take place at some point this year.
It was an opportunity for Mr Hunt to woo voters with what may be considered as ‘crowd pleasing’ changes against a backdrop of high interest rates and a technical recession. The headline announcement of the reduction in National Insurance (NI) sounds like a vote winner but voters are not easily hoodwinked and if the change in NI that was implemented last November is anything to go by, most people realise that any gain is already offset by the effect of fiscal drag resulting from the continued freeze in allowances.
The threshold at which the Higher Income Child Benefit Charge (HICBC) apples will be increased from April 6th and this will be welcomed by many, especially those who have inadvertently fallen into the trap of being caught by this charge. The threshold rises to £60,000. There have been many issues with this tax for a few years now, so this is not before time and there is still work to do. The government has pledged that they will consult on basing the HICBC on houseful incomes rather than individuals’ income from April 2026.
Holiday Let owners will see some serious detriment to their finances. The argument from Mr Hunt and some MPs for coastal towns is that these changes will release much needed properties back into the long term rental market. Only time will tell if this indeed plays out or will it have a negative effect on tourism leading to a downturn in local economies that rely so much on incoming tourists spending their money in the local communities. What is certain is that any remaining holiday cottages will become more expenses so if you are planning a ‘staycation’ in the UK best to get that organised before April 2025.
Once again, no mention of IR35 despite the growing groundswell of opinion even at the highest level that it is an awful piece of legislation.
You can read Carrington’s Spring Budget PDF here – As always, do get in touch if you have any questions.
