Easter has gone, but the new tax year is starting!
04 April 2024 Happy new tax year for Saturday 06 April 2024!
We hope that you had a great Easter and enjoyed the break. The new tax year 2024/2025 is upon us and the renewal of many of the tax allowances will occur. One of our prior blogs featured the Budget 2024 updates for this new tax year.
2024 however is likely to be a transitional year and we do not believe this will be the last Budget of the year. With a general election expected before Christmas, any new administration is likely to revisit the public finances of the UK to adjust the purse strings to suit their manifesto plans.
More on our post Budget 2024 blog can be found here: Budget blog 06-march-2024
Chapters Financial has also produced a new tax card for the tax year 2024/2025 and if you would like a copy then please let us know.
Our latest Spring 2024 newsletter also contains details of some of the relevant financial planning points that are topical here: SPRING 2024 newsletter.pdf
Standard allowances for pension contributions, along with standard ISA allowances, remain unchanged. The new additional allowance of £5,000 for a UK ISA (investing in UK assets) has been delayed until after the election.
The abolition (not in full) of the HMRC Lifetime Allowance rules occur in 2024/2025, and more on the changes can be found here: tax-free-cash limitations and the hmrc lifetime-allowance ttfa certification in 2024-2025
There are a few changes that may affect personal financial planning, as follows:
- Reduction in the capital gains tax (CGT) allowance to £3,000 from £6,000 gross pa
- Reduction in the higher rate of CGT on second properties from 28% to 24%
- Reduction in the dividend allowance to £500 from £1,000 gross pa
- Standard personal allowances, such as the income tax personal allowance and the personal savings allowance, remain unchanged
- Increase in the high-income child benefit charge threshold from £50,000 gross to £60,000 gross from April 2024, with the upper limit of the taper increasing to £80,000 (halving the rate at which the charge is applied)
- 2% National Insurance reduction for employees and the self-employed
This is not an exhaustive list; however, should provide a flavour of the personal tax positions that will occur in this tax year, perhaps until the next Budget, whenever this takes place.
No individual advice is provided during the course of this blog. The team and I look forward to helping you with your financial planning at the beginning of this new tax year.
Keith Churchouse FPFS
Director
CFP Chartered FCSI
Chartered Financial Planner
Chapters Financial Limited is authorised and regulated by the Financial Conduct Authority, number 402899
