The Autumn Budget 2024
The much-anticipated—and for some, dreaded—Autumn Budget is here. Prime Minister Keir Starmer set the tone early, urging us to "embrace the harsh light of fiscal reality." In partnership with Boring Money, we have shared our reflections on what this year’s budget could mean for you.
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Yes, a planned increase is on the horizon.
One of the most overlooked tax changes in this budget involves adjustments to inheritance tax (IHT). Although these changes are unlikely to significantly boost government revenue, they will have a considerable impact on affected families—many of whom have carefully saved and planned for future generations. From 2027, inherited pensions will, for the first time, be subject to IHT, with estates exceeding the tax threshold facing a substantial 40% rate.
The freeze on the IHT threshold until 2030 will also bring more families into the tax net, while inheritance tax relief on long-term investments has been sharply reduced, with relief on qualifying AIM shares cut by 50%.
However, proactive planning remains crucial in helping individuals reduce their estate’s potential tax burden, underscoring the importance of taking action sooner rather than later.
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It is important to be aware of the following risks: Inheritance Tax planning can be complex and demands careful consideration, the levels and bases of taxation, and reliefs from taxation, can change at any time and The Financial Conduct Authority (FCA) does not regulate some aspects of Trust, Tax and Estate Planning.
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Everyone, directly or indirectly, is likely to feel the impact of increased taxation.
One of the most notable changes is the rise in employer National Insurance (NI) contributions. Starting in April next year, the NI rate for employers will increase to 15%, up by 1.2 percentage points, with the government projecting it to generate £25 billion in revenue.
The threshold at which employers begin paying this tax will decrease from £9,100 to £5,000 per year, widening the impact on businesses.
This additional cost may be passed on to employees through lower wages, fewer job opportunities, or indirectly through inflation, as potential wage increases could drive up the prices of goods and services.
The Budget also includes higher taxes on capital gains, stamp duty for second homes, and even a levy on private jets.
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It is important to be aware of the following risks: Inheritance Tax planning can be complex and demands careful consideration, the levels and bases of taxation, and reliefs from taxation, can change at any time and The Financial Conduct Authority (FCA) does not regulate some aspects of Trust, Tax and Estate Planning.
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Holders of AIM shares will now face an effective IHT rate of 20%, which preserves some tax benefits for the junior market rather than removing them entirely.
Careful planning will be important, but with these changes taking effect in April 2026, there is time to prepare.
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It is important to be aware of the following risks: Inheritance Tax planning can be complex and demands careful consideration and the value of investments may go down as well as up and you may get back less than you invest. Past performance is not a reliable indicator of future performance. The levels and bases of taxation, and reliefs from taxation, can change at any time. Investing in shares should be regarded as a long-term investment and should fit in with your overall attitude to risk and financial circumstances. The Financial Conduct Authority (FCA) does not regulate some aspects of Trust, Tax and Estate Planning.
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For non-AIM shares, the Chancellor confirmed that Business Relief (BR) will remain IHT-free up to £1 million after the two-year holding period. This is good news for portfolios £1m and less. For amounts over this threshold, an effective IHT rate of 20% will apply.
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It is important to be aware of the following risks: Inheritance Tax planning can be complex and demands careful consideration and the value of investments may go down as well as up and you may get back less than you invest. Past performance is not a reliable indicator of future performance. The levels and bases of taxation, and reliefs from taxation, can change at any time. Investing in shares should be regarded as a long-term investment and should fit in with your overall attitude to risk and financial circumstances. The Financial Conduct Authority (FCA) does not regulate some aspects of Trust, Tax and Estate Planning.
