Finance Acts 2024-25: tax update and Rolling Tax Planner

The new finance bill 2024-25 was published on includes:

• Alternative Finance rules: changes
• Carried interest: Bringing carried interest into income tax
• Creatives: New visual effects tax relief
• Cryptoasset: reporting changes
• CGT: rate increase and Investors’ Relief reduction in lifetime limit
• Energy Profits Levy Changes to 
• SDLT: increase for additional dwellings and companies
• Furnished Holiday Lets regime: abolition of 
• Employee-ownership trusts CGT changes
• Employee benefit trusts: IHT inheritance tax rules
• IHT: band freeze
• IHT:  agricultural property relief to land managed under environmental agreement (ELMS)
• LLPs CGT: Changes to tax rules on liquidation of LLPs
• Pillar 2: undertaxed profits rule & other changes
• Remittance Basis and Non-Dom tax reform
• R&D relief legislation: correction
• UK carbon border adjustment mechanism
• VAT on school fees

Certain Autumn Budget announcements will be introduced in a later Finance Bill:

• IHT: Changes to agricultural and business property reliefs and IHT on pension pots
• PAYE: Changes relating to umbrella companies
• Compliance:Tax adviser registration
• Compliance: HMRC powers to deal with tax advisers who facilitate non-compliance
• MTD: Lowering the Making Tax Digital to the £20k threshold

NICs changes have been included in a separate NICs bill

Income Tax 

Income Tax rates, allowances and thresholds

From 6 April 2024: 

• The Personal allowance remains at £12,570 and the basic rate band remains at £37,700.
• These are frozen until April 2028. 
• The Blind person's allowance increases from £2,870 to £3,070.
• The Married couple's allowance, where one spouse is born before 6 April 1935:
  • The maximum allowance increases from £10,375 to £11,080 and the minimum amount from £4,010 to £4,280.
  • The rate of the allowance remains 10%.
  • The income limit, at which the allowance becomes restricted is £34,600. When this is exceeded the allowance is reduced by £1 for every £2 exceeding the limit, down to the minimum of £4,010.
• The Transferable Marriage Allowance remains at £1,260.
• The Additional Rate Threshold (ART) remains £125,140.

See Income Tax rates & allowances

Savings 

No changes to rates and allowances for 2024-25:

• The starting rate for savings income limit remains at £5,000
  • See Savings rates & allowances
• ISA , junior ISA and child trust funds limits remain at £20,000, £9,000 and £9,000.

Spring Budget 2024 announced the introduction of a UK-focused ISA.

• It gives an additional £5,000 allowance to the current £20,000 limit for those investing in the new ISA, ideally supporting UK companies.
• HM Treasury opened a Consultation inviting views on how to design and implement the UK ISA. It runs from 6 March 2024 to 6 June 2024.

Fractional shares

• Regulations were made in October 2024 which include amendments effective 4 November 2024 to allow certain fractional shares to be held in an ISA. See: 
  • Policy paper
  • The Individual Savings Account (Amendment) (No. 2) Regulations 2024

 See ISA Guide (Subscribers)

Help to Save reform

• In October 2024, Responses to the April 2023 ‘Help to Save Reform’ consultation were published. 
• The scheme will be extended to 5 April 2027 and expanded from April 2025 to include all working Universal Credit claimants earning £1 or more.
• Under an enhanced scheme from April 2027, bonuses will be every six months on more favourable terms. 
• The government is keen to deliver the enhanced 2027 scheme via third-party providers. A delivery consultation running until 22 January 2025 seeks their views.

See Help to Save scheme

Dividend tax

From 6 April 2024:

• The dividend allowance reduces to £500 from £1,000.
• Rates remain at: Basic rate 8.75%  Higher rate 33.75%, and Additional rate 39.35% 

See Dividend tax

High-Income Child Benefit Charge (HICBC)

From 6 April 2024

• Adjusted net income threshold for the High-Income Child Benefit Charge (HICBC) rises from £50,000 to £60,000.
• For individuals with income above £80,000, the tax charged will be equal to the amount of the Child Benefit payment.
• For those with income between £60,000 and £80,000, the rate at which HICBC is charged is halved.
  • This will be equal to one per cent for every £200 of income that exceeds £60,000.
  • The amount of Child Benefit payable will be unaffected by these changes.
• For new Child Benefit claims made after 6 April 2024, any backdated payment will be treated for HICBC purposes as if the entitlement fell in the 2024 to 2025 tax year if backdating would otherwise create a HICBC liability in the 2023 to 2024 tax year.

See High Income Child Benefit Charge (HICBC)

Gift Aid

From TBC:

• The Gift Aid legislation will be amended to ensure that eligible charities which operate subscription models can continue to claim Gift Aid while complying with the Digital Markets, Competition, and Consumers Bill.
• It is intended that these amendments to the Gift Aid regime will be in place by the time the relevant provisions of the Bill come into force.

See Gift Aid: How it works

Tax year basis: Basis year reform

• This affects sole traders or partner in partnerships which have accounting periods (a/p) that end on dates other than 31 March to 5 April.
• 2023-24 is the transitional period, tax year basis is fully operative from 6 April 2024.
• A transitional profit is calculated from the end of the a/p in 2023-24 to 5 April 2023.
• This is adjusted for Overlap relief n automatic five-year spreading rule will apply to the additional profits.
• Consultation: Income Tax Basis Period reform and Responses to the consultation

See Basis Year Reform and Accounting periods and basis periods

Making Tax Digital for Income Tax (MTD for SA)

• From April 2026: self-employed businesses and landlords with business turnover above £50,000 report under MTD for Income Tax Self Assessment (ITSA).
• From April 2027: self-employed businesses and landlords with business turnover above £30,000 report under MTD for ITSA
• At Autumn Budget 2024 it was announced thatMTD ITSA will be extended to sole traders and landlords with an income over £20,000 by the end of the Parliament. 
  • The precise date will be set out at a future fiscal event.
• From tba: other Income Tax, general partnerships and partnerships.

See Making Tax Digital Index & Timeline

Free Childcare

The Childcare (Free of Charge for Working Parents) (England) Regulations 2022 provide that:

From April 2024:

• Children from the age of two will be entitled to 15 hours of free childcare.
• Children from 3 to 4 will be entitled to 15 hours of childcare, which can be increased to 30 if the parents are eligible (see below).

From September 2024:

• Children from the age of 9 months will be entitled to 15 hours of free childcare.
• Children from 3 to 4 will be entitled to 15 hours of childcare, which can be increased to 30 if the parents are eligible (see below).

From September 2025:

• Working parents of all children over 9 months but under 5 will be entitled to 15 hours of free childcare, this can be increased to 30 if the parents are eligible (see below).

It is worth noting that the free hours of childcare are for 38 weeks of the year.

See Childcare: Free and Tax-free Childcare

Enterprise Investment Scheme (EIS) and Venture Capital Trust (VCT) extension

• Finance Act 2024 to extended the existing sunset clauses for the EIS and VCT schemes from 6 April 2025 to 6 April 2035.
• This will continue the availability of Income Tax and Capital Gains Tax reliefs for investors in new shares issued before 6 April 2035 by EIS-qualifying companies and VCTs. 

See EIS Subscriber Guide

Consultation: charities tax compliance

• At Autumn Budget 2024 the government responded to the 2023 consultation on charities.
• There will be no changes before April 2026
• See Charities Tax Complicance consultation outcome
• The government will continue to work with the sector on the necessary legislation and guidance, and will make incremental changes in all four of these areas, to preserve these important tax reliefs for the compliant majority and help to protect the reputation of the sector.
• In April 2023, the consultation ‘Charities tax compliance’ which explored possible changes allowing HMRC to tackle charities that obtain reliefs in ways that are not intended. 
• The consultation ran from 27 April to 20 July 2023. 

 See Charities tax compliance consultation

Expanding the cash basis

From 6 April 2024

• Finance Act 2024 makes the cash basis the default method for calculating trading profits for the self-employed and partnerships.
  • The turnover, interest, and loss relief restrictions are removed from the cash basis (note: losses subject to the Cap on Income Tax reliefs).
  • Businesses not wishing to calculate their profits using the cash basis will need to make an election to use the accruals basis.
• The measure does not affect companies, property businesses, or businesses that are otherwise excluded from using the cash basis, such as mixed partnerships, Limited Liability Partnerships, or businesses claiming farmers’ or artists’ averaging relief.
• This follows a previous consultation. See Consultation: Expanding the Cash Basis
• Policy paper: Expanding the Income Tax cash basis for self-employed individuals and partnerships

See Cash Basis for Income Tax

Cryptoassets reporting

From 6 April 2024:

• Reporting changes on Self Assessment tax return forms SA108 (Capital gains summary page) and SA905 (Trust and estate capital gains page) requiring amounts in respect of cryptoassets to be separately identified.
• The changes will be introduced on the forms for the tax year 2024-25.

Exemption from Income Tax for low-income trusts and estates

From 6 April 2024:

• Trusts and estates with income below £500 will no longer be subject to Income Tax, raising the previous £100 exemption.
  • This is an all-or-nothing relief: if the estate or trust has income of £501 the whole amount will be taxable and not just the excess over £500.
  • Where a settlor has a number of discretionary and/or accumulation and maintenance trusts, the £500 limit will be split amongst those trusts but with a minimum level per trust of £100. Other non-discretionary trusts settled by the same individual, such as interest in possession trusts, will not be taken into account.
• Beneficiaries of UK estates will not pay tax on estate income treated as paid from income within the personal
  representatives’ £500 de minimis amount.
• Amendments also provide that the income received by an estate beneficiary is savings income where it was savings income of the personal representatives. It is also clarified that an estate beneficiary’s gross taxable income and tax credit should reflect the tax previously paid by the personal representatives.
• Policy paper: Simplifications for trusts and estates

See Acting for a trust? Start here… and Estates: Income Tax and Capital Gains Tax

Removal of default rate for first £1,000 of discretionary trust income

From April 2024 all income including the first £1,000 will be taxable at the following rates:

• Dividend income: 39.35%.
• All other income: 45%.

Policy paper: Simplifications for trusts and estates

See Acting for a trust? Start here…

Extending Tax Conditionality to licencing

Tax Conditionality has applied to those obtaining licences in the taxi and scrap metal sectors in England and Northern Ireland since 2022.

• Under tax conditionality, access to licences to operate in a specific sector is made conditional on that business being registered for tax. This includes registration for Income Tax or Corporation Tax and PAYE.
• Similar measures were adopted by the devolved governments in Scotland and Wales in 2023.
• The government now proposes expanding tax conditionality to new sectors. 

A new consultation was launched at the budget to seek views from those involved with licences, registrations, exemptions and permits in:

• The waste sector, including waste carriers, brokers and dealers.
• Animal welfare licences, including dog breeders, animal boarding and pet selling.
• Specific licences for vehicles in the taxi and private hire sector across the UK.

This includes licence applicants, licensing bodies and providers, their representatives or professional bodies and those with expertise in tax administration.

The consultation will run for 12 weeks from 30 October 2024 to 31 January 2025.

See Consultation: Tackling the hidden economy: expanding tax conditionality to new sectors

See Tax Conditionality

New Tax exemptions: 

• No liability to income tax arises on pension age disability paymentspension age disability payments
  • See The Income Tax (Exemption of Social Security Benefits) (No. 2) Regulations 2024, SI 2024/90
• exemptions from income tax and capital gains tax, and a relief from inheritance tax, for Infected Blood Compensation Scheme payment.
  • See The Infected Blood Compensation Scheme (Tax Exemptions and Relief) Regulations 2024, SI 2024/902

National Insurance (NICs)

Thresholds and rates: 2024-25

From 6 April 2024: 

• Compulsory Class 2 (self-employed) NICs are abolished. Self-employed individuals with profits: 
  • Above £12,570 will no longer be required to pay Class 2 NICs, but will continue to receive access to contributory benefits including the state pension. 
  • Between £6,725 and £12,570 will continue to receive access to contributory benefits, including the state pension, by way of an NI credit.
  • Below £6,725 who choose to make voluntary Class 2 contributions to secure access to contributory benefits can continue to do so.

Autumn Budget 2024 proposals: from 6 April 2025 to 5 April 2028

• The Class 1 secondary threshold (for employers contributions) will be reduced from £9,100 to £5,000 per annum.
• The rate of secondary contributions for Class 1, together with Class 1A and Class 1B rates will increase from 13.8% to 15%.
• The Employment Allowance will increase from £5,000 to £10,500.
• The restriction will be removed whereby Employment Allowance can only be claimed by employers who have incurred a secondary Class 1 NICs liability of less than £100,000.
• The employer NICs relief for employers hiring qualifying veterans is extended for a further year from 6 April 2025 until 5 April 2026.
• These changes will be introduced by primary legislation ahead of 6 April 2025.

See National Insurance: Rates

Mandating postcode provision for Freeports and Investment Zones National Insurance contributions reliefs

• Noted on Tax Administration & Maintenance Day: to bring forward a legislative change to mandate employers operating in a Freeport or Investment Zone to provide their employee’s workplace postcode to HMRC, where they are claiming secondary Class 1 National Insurance Contributions (NICs) relief through their payroll.
  • This data is intended to reduce employer error and enable assurance of claims by HMRC without HMRC having to contact the employer.
• A four-week technical consultation on draft regulations closes on 15 May 2024. 
  • After the consultation, secondary legislation will be brought forward. Software developers will be given time to make changes ahead of implementation.

See HMRC: Freeport and Investment Zone employer National Insurance contributions reliefs

Pensions 

From 5 April 2024

• The lifetime allowance is abolished.and the annual savings limit remain at £60,000.
  • For those without protections the pensions tax-free lump sum will be limited to 25% of the current lifetime allowance (LTA) limit or £268,275.
• The Tapered annual allowance applies when adjusted income is more than £260,000.
• The Money Purchase annual allowance is £10,000.
• HMRC's Lifetime Allowance guide provides answers to FAQs about measures to abolish the LTA to clarify the tax treatment of pension savings, including how pensions lump sums and lump sum death benefits will be taxed in its absence, the position of individuals with LTA protections, lump sum protections or LTA enhancement factors and he function of BCEs.
• Policy paper: Abolition of the Lifetime Allowance from 6 April 2024

See Pensions: Tax rules & planning

Top-up for net-pay arrangements

From April 2024:

• Following aCall for evidence in 2021: individuals making pension contributions to net pay schemes from 2024-25 will be eligible to claim a top-up. Government says that 1.2 million individuals, 75% of whom are women, could benefit by an average of £53 a year.

See Top-up for pensions

Increasing the normal minimum pension age

From 6 April 2028:

• Finance Act 2022 includes a measure to increase the Normal Minimum Pension Age (NMPA) from 55 to 57.
• The NMPA is the minimum age at which most pension savers can access their pensions without incurring an unauthorised payment tax charge unless they are retiring due to ill-health
• Policy paper and draft legislation: Increasing the normal minimum pension age for Pensions Tax

See Pensions: Unauthorised payment charges

Surplus extraction arrangements for defined benefit pension scheme

From 6 April 2024

• Secondary legislation reduces the free-standing tax charge which applies to authorised surplus payments to sponsoring employers of a registered pension scheme from 35% to 25% will be introduced.

See Pensions: Unauthorised payment charges

Autumn Budget 2024 measures: IHT on pensions

From 6 April 2027:

• Unused pension funds and death benefits payable from a pension become liable to IHT
• Currently, pensions held within trust fall outside the scope of IHT.
• Pension scheme administrators to report nd pay IHT due on unused pension funds and death benefits.
• A technical consultation has been launched on the processes required to implement these changes for UK-registered pension schemes. This closes on 22 January 2025. 

See IHT on pensions: summary and consultation

Corporation Tax

Tax Rates 

For FY2024 (from 1 April 2024):

• No changes to main rate of Corporation Tax of 25% for companies with taxable profits above £250,000. 
• The 19% rate continue to apply to companies with profits below £50,000.
• Where profits are between £50,000 and £250,000 marginal rates apply.
• No changes were made to rates at Autumn Budget 2024.

See Company tax rates and allowances

EIS and VCT extension

From 6 April 2025

• Legislation will be introduced in the Autumn Finance Bill 2023 to extend the existing sunset clauses for the EIS and VCT scheme from 6 April 2025 to 6 April 2035.
• Policy paper: Extension of the Enterprise Investment Scheme and Venture Capital Trust Scheme

See Enterprise Investment Scheme: subscriber guide

Research and Development (R&D) Tax Relief: Intensity threshold

From 1 April 2024:

• The intensity threshold for qualification for enhanced support for R&D-intensive SMEs will be reduced from 40% to 30%.
• A one-year grace period will be introduced allowing companies dipping under the 30% threshold to continue to qualify.
• Policy paper: Enhanced support for Research & Development (R&D) intensive small or medium enterprises (SMEs)
• Legislation: Finance Act 2024 Schedule 1

Research and Development (R&D) Tax Relief: Scheme Reform

From 1 April 2024:

• For accounting periods beginning on or after 1 April 2024, qualifying companies can only make claims under the Merged RDEC scheme.
  • Companies will no longer be able to claim relief under the R&D Expenditure Credit (RDEC) scheme or Small or Medium-sized Enterprise (SME) tax relief
  • The only exception is for loss-making R&D-intensive SME companies, which can continue to claim under the Enhanced R&D Intensive Support (ERIS) scheme.
• The notional tax rate applied to loss-makers in the merged scheme will be the small profit rate of 19%, rather than the 25% main rate currently set in the RDEC.
• The government’s consultation on merging the RDEC and SME schemes closed on 13 March 2023, see Consultation: R&D Tax Reliefs: A single scheme
• Policy paper: Merger of current small or medium enterprise (SME) and Research and Development Expenditure Credit (RDEC) schemes
• Policy paper: Autumn Statement 2023 Research and Development Tax Reliefs Reform
• The legislation will also remove the use of nominated payees for R&D tax credit payments, subject to limited exceptions, for all claims made on or after 1 April 2024.
• Policy paper: Restricting nominations and assignments for Research and Development (R&D) Relief
• Legislation: Finance Act 2024 Schedule 1 

See Research & Development Relief

New rules for Contracted-Out R&D & Externally Provided Workers (EPW) 

From 1 April 2024 

• The legislation has introduced a new definition of 'contracted out'. This definition identifies the decision maker of the R&D to determine who is entitled to claim relief.
• In March 2024, HMRC issued updated draft guidance for contracted-out R&D.
• HMRC guidance Research and development tax reliefs: new contracting out rules and overseas restrictions – draft guidance
• Legislation: Finance Act 2024 Schedule 1 

See, R&D: Contracting out R&D & Externally Provided Workers (EPW)

Additional Information Form 

From 2 October 2024 

• The Research and Development Relief (Information Requirements etc.) Regulations 2024 (SI 2024/950) will come into force.
• This legislation sets out the revised information that must be provided by a company claiming R&D relief.
• On 12 September 2024, HMRC issued a new version of the AIF, which must be used for claims made on or after 2 October 2024.

See, R&D: Additional Information Form (AIF)

Business rates for film studios 

From 1 April 2024:

• Eligible film studios in England will receive a 40% reduction in gross Business rates until 2034, with relief backdated to 1 April 2024.
• Studios will still be able to claim Improvement Relief where qualifying conditions are met. 

See Spring Budget 2024: Corporation Tax

Creative Industries Reliefs

UK Independent Film Tax Credit (IFTC) 

For qualifying expenditure incurred on or after 1 April 2024: 

• On 9 October 2024, the government introduced new regulations to implement the Independent Film Tax Credit (IFTC).
• The IFTC is additional relief for low-budget films with specified UK connections, announced in the 2024 Spring Budget.
• The IFTC allows eligible companies to claim an enhanced Audiovisual Expenditure Credit (AVEC) at a rate of 53% on their qualifying expenditure.
• The Film must meet the creative connection condition and total core expenditure in relation to the film must not exceed £23,500,000. 
• Qualifying expenditure will be capped at a maximum of 80% of a film’s total core expenditure. The taxable credit for a film will be capped at £6.36 million.

From 30 October 2024:

• Eligible companies can apply for an eligibility certificate from the British Film Institute.

See, Creative Industries: Audio-Visual Expenditure Credit (AVEC) & Video Games Expenditure Credit (VGEC)

Permanent rates of relief for Theatre, Orchestra, Museum and Galleries Tax Relief

From 1 April 2025:

TTR, OTR and MGETR

• The rates of relief for Theatre Tax Relief (TTR), Orchestra Tax Relief (OTR) and Museums and Galleries Exhibition Tax Relief (MGETR) fall to  40% (from 45%) and 45% (from 50%) (for non-touring TTR and MGETR) until 1 April 2025.
• The sunset clause on MGETR will also be postponed for two years. Expenditure will now longer qualify for relief from 1 April 2026.

Creative Relief rates

From 1 April 2024

• Finance Bill 2023-24: relief claims will require an online information form to be submitted as part of the claim.

AVEC and VGEC

From 1 January 2024

• Audio-Visual Expenditure Credit (AVEC) replaces Film Tax Relief, High-End TV Tax Relief, Animation Tax Relief and Children’s TV Tax Relief and Video Games Expenditure Credit (VGEC) replaces Video games tax reliefs.
• Both operate in a similar way to the R& D RDEC
• The credit can be claimed voluntarily but all new productions must claim under the new scheme from 1 April 2025, and all productions from 1 April 2027.
• Administrative amendments affect provision of certification and deduction from profits
• Policy paper: Audio-Visual and Video Games Expenditure Credits: administrative amendments
• See Autumn Budget 2024: Companies

Expenditure on visual effects (VFX)

From 1 April 2025:

• Film and high-end TV programmes will be able to claim an enhanced AVEC at a rate of 39% on their UK visual effects costs. The 80% cap on qualifying expenditures will be removed. 
• Following a March 2024 consultation, Consultation on additional tax relief for visual effects, at Autumn Budget 2024 the government published Consultation on additional tax relief for visual effect costs - summary of responses
  
  • See Visual effects costs defined (our summary of the condoc outcome)
• New legislation will define visual effects: 'visual effects is work consisting of the use of computer technology to create or alter images for the inclusion in the film or programme'.
• Details of the evidence of qualifying expenditure required will be set out in regulations before 1 April 2025.
• Policy Paper: Corporation Tax: additional tax credit for visual effects (VFX) expenditure.
• See Autumn Budget 2024: Companies

See Creative Industries: Audio-Visual Expenditure Credit (AVEC) & Video Games Expenditure Credit (VGEC)

Removing EEA expenditure in theatre, orchestra and museum and galleries exhibition tax reliefs

From 1 April 2024:

• The definition of qualifying expenditure will be changed from ‘expenditure that is incurred on goods and services provided from within the UK or EEA’, to ‘expenditure on goods and services that are used or consumed in the UK.’
• The eligibility requirement for the reliefs will be changed to require a minimum of 10% of expenditure to be on ‘goods and services used or consumed in the UK.’

See Creative Industries: Museum & Gallery Exhibitions Tax Relief

Making Tax Digital (MTD) for Corporation Tax

• There are no plans to commence MTD for Corporation Tax at present.
• HMRC's Making Tax Digital for Corporation Tax consultation closed on 5 March 2021, it proposed date for a voluntary pilot of April 2024. No mandated use will be implemented before April 2026. See Consultation: Making Tax Digital for Corporation Tax

See Making Tax Digital

Loans to particpators (s.455) 

At the Autumn Budget 2024, the Government issued draft legislation to update the Targeted Anti-Avoidance Rule (TAAR).

• The Government has identified arrangements where a group of companies or associated companies use chains of loans to avoid a s.455 charge.
• Currently, the TAAR will not apply where loans or other extractions are repaid, even in cases of avoidance.
• From 30 October 2024, the TAAR will be updated to apply when companies and shareholders attempt to avoid s.455 on any transactions.
• In effect, the TAAR will apply to any arrangements where the arrangement avoids, reduces, or obtains relief or increased relief from a s.455 charge on the company, or where there is an Income Tax advantage for the participator, irrespective of whether there has been a repayment.
• See, Policy paper: Corporation Tax — close company shareholders — anti-avoidance measure

See, Loans to participators (Close Company toolkit)

Multinationals

• On 29 July 2024 HMRC published policy paper, 'Multinational top-up tax and domestic top-up tax — transitional country by country reporting safe harbour anti-arbitrage rule'.
• The draft legislation is set to amend Finance (No.2) Act 2023 to introduce an anti-arbitrage rule to the Transitional CbCR Safe Harbour. 
  • The aim of the additional provisions is to prevent Multinational Enterprises (MNEs) from benefiting from the safe harbour where they have entered certain hybrid arbitrage arrangements.  
  • Paragraph 6A and 6B will be introduced to Schedule 16, Part 2. 
    • These paragraphs adjust the calculation that determines access to the transitional safe harbour when a member of a group has incurred a disqualifying expense. 
    • Any such expense is required by the new rule to be added back in computing the aggregate profit or loss of the standard members of a group in a territory.
    • This adjustment will reduce the group’s Effective Tax Rate (ETR) in that territory for the purposes of the Transitional CbCR Safe Harbour test.
  • This amendment ensures that UK legislation remains consistent with OECD administrative guidance on the GloBE rules agreed by the UK and other members of the Inclusive Framework.

See, Transitional CbCR Safe Harbour: anti-arbitrage rule

The Private Intermittent Securities and Capital Exchange System (PISCES)

• A new type of regulated trading platform will allows for the intermittent trading of private company shares on a multilateral system. 
• Subject to the technical feedback on its draft SI, the Treasury intends to introduce the PISCES legislation by May 2025.
• A draft statutory instrument with an accompanying policy note is published alongside this document to illustrate how the Treasury intends to set up the PISCES regime: 
• The Treasury welcomes technical comments on this draft legislation by 9 January 2025. Please send responses to This email address is being protected from spambots. You need JavaScript enabled to view it.. 

See Private Intermittent Securities and Capital Exchange System (PISCES)

Employers

National Living Wage (NLW)/National Minimum Wage (NMW)

From April 2024:

• The NLW will increase to £11.44 per hour and be extended to include those aged 21. 
• The NMW for those aged 18-20 will increase to £8.60 per hour. 
• The apprentice rate will increase to £6.40 per hour. 

See National Living Wage rates/National Minimum Wages rates

Taxable benefits

Cars and Vans

From 6 April 2024

• The van benefit charge and the car and van fuel benefit charges will be maintained at 2023-24 levels for 2024-25.
  • The van benefit charge will remain at £3,960.
  • The van fuel benefit charge will remain at £757.
  • The car fuel benefit multiplier will remain at £27,800.

• Rates are set for Company Car tax until April 2028:
  • Percentages for electric and ultra-low emission cars emitting less than 75g of CO₂ per kilometre will increase by 1% in 2025-26, 2026-27 and 2027-28.
    • This will bring rates to a maximum of 5% for electric cars and 21% for ultra-low-emission cars.
  • Rates for all other vehicle bands will be increased by 1% for 2025-26 up to a maximum percentage of 37%.
    • Rates will then be fixed for 2026-27 and 2027-28.
• Policy paper: Income Tax: Increasing the appropriate percentage for company cars

See Car fuel benefit charges, Company cars, CO2 emissions: Ultra-low emission cars and Van Benefit Charges

Enterprise Management Incentives (EMI)

From 6 April 2024:

• Finance Act 2024 extended the deadline for notifying an EMI option is extended from 92 days following grant to the 6 July following the end of the tax year. 

See EMI Share Options

Non-discretionary tax advantaged share scheme: Responses still awaited

• In June 2023 the government launched a call for evidence on the Share Incentive Plan and Save As You Earn employee share schemes to consider opportunities to improve and simplify the schemes.
• The call for evidence closed on 25 August 2023.
• See HM Treasury review of SAYE and SIP schemes

Consultation on occupational health tax incentives: Responses still awaited

• Spring Budget 2023: a consultation on options to increase investment in occupational health services by employers through the tax system, including a potential expansion of the existing benefits in kind for occupational health services or a potential super-deduction style relief for businesses who provide services to their employees.
• In July 2023 HM Treasury and HMRC opened a joint consultation ‘Tax incentives for occupational health’ which closed on 12 October 2023.

Off-Payroll Working

From 6 April 2024

• For Off-Payroll Working engagements, HMRC will be able to reduce the PAYE liability of a deemed employer, where that engagement has been incorrectly treated as self-employed for tax purposes, to take account of tax and National Insurance Contributions already paid by the worker and their intermediary on the payments received.
• Policy paper: Calculation of PAYE liability in cases of non-compliance with off-payroll working
• Technical policy consultation: Calculating PAYE liabilities runs 25 January 2024 - 22 February 2024.
• This follows previous Consultation on Off-Payroll Working

See Off-payroll working

Consultation to close EOT and EBT loopholes: Responses awaited

• In July 2023, the government launched a consultation 'Taxation of Employee Ownership Trusts and Employee Benefit Trusts'. 
• A number of proposals are made including ensuring that ex-owners cannot control the board of trustees, ensuring that trustees do not avoid later CGT by being non-resident, and ensuring that participators do not benefit from income. 
• The consultation closed on 25 September 2023. 

See Consultation to close EOT and EBT loopholes

Proposals tackle Umbrella Company non-compliance

• A June 2023 consultation ‘Tackling non-compliance in the umbrella company market’ covered proposals include defining umbrella company arrangements as one of four methods of engaging and paying agency workers and making the dividing line between employment businesses and umbrella companies clearer. Measures to combat the exploitation of the VAT Flat Rate Scheme and Employment Allowance are also proposed. That consultation closed on 29 August 2023.
• In April 2024, a Tax Administration & Maintenance Day announcement confirmed that new guidance would be published in 2024, including an online pay-checking tool, to verify whether correct deductions are being made from pay. 
• The government also intends to introduce a due diligence requirement to tackle bad actors in labour supply chains.
• See New proposals tackle Umbrella Company non-compliance

PAYE amendments in respect of salary advances

From 6 April 2024

• The reporting requirements for salary advances changes. Both the FPS and the deductions working sheet should treat the advance payments and the subsequent reduced regular relevant payment as a single payment.
• For reporting purposes, the payments are treated as being made on the date that the reduced regular relevant payment is made.
• Employers will be required to report the payment by the date on which the reduced regular relevant payment is paid. 
• This means each payment of salary only needs to be included on an RTI report once.
• See Consultation: Payroll reporting for salary advances

See: Salary advances changes

Paternity leave and pay 

From 8 March 2024:

• The way paternity leave and pay can be claimed and taken will be changed to make it more flexible to access. 
• Fathers and partners will be eligible to claim Statutory Paternity Pay and Leave (SPPL) under the new rules if the expected date of birth of their baby is after 6 April 2024, or if the child is born early and before that date.
• Payroll software may not be updated in time to apply the new rules where babies are born early. The transitional guidance published in the January 2024 Agent Update should be followed in such cases. 

See Agent Update: January 2024

Mandatory payrolling

From April 2026:

• Payrolling Benefits In Kind, to report and pay Income Tax and Class 1A NICs, will be mandatory.
• Draft legislation will be published later in 2024.

See HMRC simplification update: January 2024

Construction Industry Scheme (CIS)

From 6 April 2024

• Finance Act 2024 now specifies the taxes included in the CIS Gross Payment Status (GPS) registration Conditionality/Compliance tests.

Further changes from 6 April 2024 include:

• The majority of payments from landlords to tenants will be removed from the scope of CIS.
• A digital application process for CIS registrations will be introduced alongside the existing postal process.
  • Telephone applications will only be available to the digitally exempt.
  • Digital will ultimately be mandated as the only channel for CIS applications.

Background to these measures: In April 2023, HMRC opened a new Consultation on reforming the Construction Industry Scheme (CIS). Responses were published in November 2023, alongside announcements made at the 2023 Autumn Statement. 

Employee workplace reporting: Freeports and Investment Zones

• In April 2024, HMRC opened a consultation on draft regulations to mandate employers operating in a Freeport or Investment Zone to provide their employee’s workplace postcode to HMRC, where they are claiming secondary Class 1 National Insurance Contributions (NICs) relief through their payroll.
• The consultation closes on 15 May 2024.

See Tax Administration and Maintenance Day 2024 at a glance

Updated hybrid working travel examples

• In May 2024 HMRC made a rare update to its Employer Travel guide, giving new examples of travel expenses with ordinary commuting and hybrid workers following post-COVID pandemic changes to employee working patterns.
• See HMRC updates employer travel examples

Apprenticeship levy/growth and skills levy

• In September 2024, a new growth and skills levy was announced to replace the existing apprenticeship levy and include new foundation apprenticeships.
• The Department for Education will set out further details on the scope of the offer and how it will be accessed in due course.
• Press release: Prime Minister overhauls apprenticeships to support opportunity

See Apprenticeship levy (employers' briefing)

Capital Allowances

Full expensing: extension

• Full expensing and the associated 50% FYA are made permanent by Finance Act 2024, instead of ending on 31 March 2026 as originally intended.
• Spring Budget 2024 confirmed that full expensing extends to leasing.
• HM Treasury guidance: Terms of Reference: HMT-HMRC Capital Allowances and Leasing working group

See Full expensing & First Year Allowances

First Year Allowance for Electric Vehicle Charge points

From April 2023:

• Finance (No.2) Act 2023 extends the 100% First Year Allowance for electric vehicle charge points to 31 March 2025 for Corporation Tax purposes and 5 April 2025 for Income Tax purposes.

See Enhanced Capital Allowances: Energy saving plant (inc. vehicles)

Capital Gains Tax (CGT) 

Rates and allowances

From April 2024:

• The Annual Exemption from £6,000 to £3,000 for individuals and personal representatives, and from £3,000 to £1,500 for most trustees.
• Finance (no 2) Bill 2024 decreases the higher rate of CGT on the disposal of residential property from 28% to 24%.

See CGT rates, allowances and exemptions

Autumn Budget 2024 made further changes to rates:

From 30 October 2024:

• The lower rate of CGT increased from 10% to 18%.
• The higher rate of CGT increased from 20% to 24%.
• The rate of CGT that applies to trustees and personal representatives increased from 20% to 24%. 

From 6 April 2025:

• The rate of Business Asset Disposal Relief (BADR) and Investors’ Relief (IR) will rise from 10% to 14%.
• The rate for Carried Interest rises to 32%.

From 6 April 2026:

• The rate of BADR and IR will rise from 14% to 18%.
• Carried Interest gains are taxed as profits subject to Income Tax

Transitional rules & documents

• There are anti-forstalling rules for arrangements entered into in respect of unconditional but uncompleted contracts before 30 October 2024, and Investors' Relief and Business Asset Disposal Relief  where a contract is made from 30 October 2024 to 5 April 2026, and completed from 6 April 2025 and tax avoidance was the main motive.
• Policy paper: Policy paper: Capital Gains Tax — rates of tax

See CGT Rates & Allowances

Making Elections to disapply the CGT share reorganisation rules

Capital gains arising from making an election to disapply the CGT share reorganisation rules will be chargeable at the CGT rates applying at the date the election is made, where;

• There was a share reorganisations of a single company before 30 October 2024 and the shareholder continues to meet the conditions for BADR on that date, and 
• There has been a share for share exchange before 30 October 2024, and either, 
  • The companies involved are owned or controlled by substantially the same persons, or 
  • The persons who held shares in the first company hold a greater percentage of the shares in the company that issued the shares in exchange for them and, at the time of the election, the shareholder continues to meet the conditions for claiming BADR on a disposal of their new shares.
• On or after 30 October 2024, the shareholder continues to meet the conditions for claiming Investors’ Relief (IR) and an election is made on or after 6 April 2025. 
• These rules also apply to reorganisations on or after 30 October 2024 for the phased increase in the CGT rate for BADR and IR gains.
• Policy paper: Policy paper: Capital Gains Tax — rates of tax

See Investors' Relief and Business Asset Disposal Relief Disposal of a business

Investors’ Relief (IR) Lifetime Limit 

From 30 October 2024:

• The lifetime limit for Investors’ Relief (IR) will be reduced to £1,000,000.
• The lifetime limit takes into account the value of relief claimed on all past qualifying gains.

Where an election is made to trigger a gain at the time of reorganisation in order to claim IR, anti-forestalling rules will apply to treat the share disposal as taking place at the time the election is made, where:

• A reorganisation of the company’s shares occurred before 30 October 2024.
• The shareholder continues to meet the conditions for claiming IR as of 30 October 2024, and
• The shareholder makes the election after 30 October 2024 to trigger a gain at the time of the reorganisation in order to claim IR.
• Policy paper: Capital Gains Tax: Investors’ Relief — lifetime limit reduction 

See Investors' Relief

Carried interest

From 6 April 2025:

• Finance Bill 2024-25 will raise the CGT rates applied to carried interest to a single 32% rate, irrespective of whether the individual is a basic rate or higher rate taxpayer. 

From 6 April 2026:

• Carried interest will be taxed under the Income Tax framework, as trading profits from a deemed trade. Class 4 National Insurance Contributions (NICs) will also apply.
• Where an individual receives qualifying carried interest, the amount of trading profits which would otherwise be brought into charge will be multiplied by 72.5%.
  • The net amount, after applying the 72.5% multiplier, will be the amount brought into charge as trading profits and taxed at the individual’s applicable marginal rate of Income Tax (plus NICs).
• These proposals follow a call for evidence held earlier in 2024, for which an outcome has now been published. This contains further detail on how the Income Tax rules for carried interest will operate. 
• The government will undertake further technical consultation prior to implementation.
• Policy paper: Carried interest: rates of Capital Gains Tax
• Call for evidence outcome: The Tax Treatment of Carried Interest

See Carried Interests

CGT on the liquidation of Limited Liability Partnerships (LLPs)

From 30 October 2024: 

• Announced at Autumn Budget 2024: A disposal will be deemed to occur when an LLP is liquidated, where assets contributed by a member are transferred to them, a connected company, or another connected person.
• The chargeable gain accruing to the member will be calculated as if the gain had arisen at the time they initially contributed the asset to the LLP, disregarding section 59A TCGA 1992.
• The LLP will remain liable for any gains in the usual manner from that time, based on the actual disposal of the asset.
• Draft legislation is included in Finance Bill 2024-25, policy paper: Capital Gains: Limited Liability Partnership liquidations

See Partnerships: Capital Gains Tax

Employee Ownership Trusts (EOTs)

From 30 October 2024

At Autumn Budget 2024, the Government confirmed changes following its July 2023 Consultation on new plans to close EOT and EBT loopholes.

• Changes to the conditions for obtaining CGT relief on the disposal of a controlling shareholding in a company to the trustees inlude:
• Changes to the independence conditions so that ex-owners cannot control a board of trustees.
• Trustee residence and a specific relief to provide legislative certainty regarding the distribution tax treatment of contributions paid to the trustees has been introduced. 
• There has been a small adjustment to the conditions for obtaining Income Tax relief on annual bonuses made to employees of EOT-owned companies to allow directors to be excluded from the bonus award.
• For CGT relief claims in 2024-25 for disposals to an EOT: Claimants must provide additional information within their claim for CGT relief. This includes information on slae proceeds and the number of employees at the time of disposal.
• Policy paper: Changes to the taxation of Employee Ownership Trusts and Employee Benefit Trusts
• Consultation outcome: Taxation of Employee Ownership Trusts and Employee Benefit Trusts

See Employee Ownership Trust (EOT)

Measures for IHT. see section below

Incorporation relief: clarification over ESC D32

• See Land and property tab

Tax simplification for alternative finance arrangements: Responses still awaited

• A consultation was published in January 2024 proposing changes to the CGT rules that apply to alternative finance arrangements such that where property is used as collateral for the purposes of raising finance under alternative finance arrangementments, the CGT outcome is the same as when conventional finance is used.
• The capital allowance implications of refinancing via alternative finance arrangements are also explored.
• The consultation closes on 9 April 2024.

See Simplifying alternative refinancing arrangements for tax

Inheritance Tax (IHT)

• The Inheritance Tax nil-rate bands are frozen until April 2028.
  • The standard nil-rate band remains at £325,000.
  • The residence nil-rate band remains at £175,000.
  • The residence nil-rate band taper continues to start at £2 million. 
• Policy paper: Inheritance Tax nil-rate band and residence nil-rate band thresholds from 6 April 2026

See IHT: Transferable Nil-Rate Band, IHT: Main Residence Nil-Rate Band (RNRB), and IHT rates and allowances

Payment of IHT

From 1 April 2024:

• Personal representatives of estates will no longer need to have sought commercial loans to pay IHT before applying to obtain a ‘grant on credit’ from HMRC.

See Probate: At a glance

Tax-free limit for trust and estate income

From 6 April 2024:

• Settlements and estates with income of all types up to £500 will not pay Income Tax on that income as it arises.
  • Where income exceeds £500, tax will be payable on the full amount.
  • Where a settlor has a number of discretionary and accumulation and maintenance trusts existing during the year, the £500 limit will be split amongst those trusts but with a minimum level per trust of £100. 
• For accumulation and discretionary trusts with income that exceeds £500, the default basic rate (20%) and dividend ordinary rate (8.75%) will no longer apply to the first £1,000 slice of trust rate income (commonly referred to as the standard rate band).
• Tax pool adjustment payments due when a discretionary distribution is made continue to be payable, irrespective of the level of trust income in a year.
• For estates, the £500 tax-free amount will apply:
  • For every tax year of administration, unused amounts do not roll over to subsequent years when reporting under informal procedures.
  • To all types of income, after taking off ISA income which continues to be exempt after a person has died until closure or up to three years following the death.

See UK Trusts and Estates: Income Tax and Capital Gains Tax

Geographical scope of Agricultural Property Relief (APR) and Woodlands Relief

From 6 April 2024: 

• The geographical scope of Agricultural Property Relief (APR) and Woodlands Relief, for IHT purposes, will be restricted to property in the UK.
  • Property located in the European Economic Area (EEA), the Channel Islands, and the Isle of Man will be excluded from relief.
• Policy paper and draft legislation: Changes to the geographical scope of agricultural property relief and woodlands relief for Inheritance Tax
• See Taxation of environmental land management

See IHT Agricultural Property Relief and Woodlands: Overview

Scope of IHT: domicile: New residence regime: abolition of Non-domicile status & the Remittance Basis

From 6 April 2025:

• The current domiciled-based regime will be replaced with a new residence-based regime following the abolishment of the non-UK domiciled rules. 
• The test for whether non-UK assets will be in scope for IHT will be whether an individual has been resident in the UK for at least 10 out of the last 20 tax years immediately preceding the tax year in which the chargeable event (including death) arises.
• The time an individual remains in scope after leaving the UK will be shortened where they have only been resident in the UK for between 10 and 19 years.

For trusts, the excluded property status of non-UK settled assets will not be fixed at the time the assets are added to the settlement.

• Assets comprised in a settlement will only be excluded property (and so not subject to IHT charges) at times when the settlor is not a long-term resident.
• When a settlor is a long-term resident, any assets they have settled (even when not a long-term resident) will be subject to IHT.
• Budget documents and draft legislation, see  Policy paper: Reforming the taxation of non-UK domiciled individuals and Tax changes for non-UK domiciled individuals  Policy paper

See Non-Domiciled Individuals and Remittance Basis: Client Briefing

Agricultural Property Relief (APR) IHT & EMLs

From 6 April 2025:

• At Autumn Budget 2024 it was confirmed that legislation in a future Finance Bill will extend the scope of APR to environmental land management (ELMs).  
• Relief will be available for land managed under an environmental agreement with, or on behalf of, the UK government, Devolved Administrations, public bodies, local authorities, or approved responsible bodies. This includes agreements in place on or after 6 March 2024.
• Policy paper: Agricultural Property Relief and environmental land management 

See IHT Agricultural Property Relief and Farming: Tax Overview

Restriction to Agricultural Property Relief (APR) and Business Property Relief (BPR)

From 6 April 2026: 

• The rate of APR and BPR will remain at 100% up to a combined allowance of £1m. 
• Where the value of business and agricultural property assets exceeds the £1m allowance, the rate of relief will be reduced to 50%.
• If the total value of the qualifying property to which 100% relief applies is more than £1m, the allowance will be applied proportionately across the qualifying property.
• Assets automatically receiving 50% relief will not use up the allowance and any unused allowance will not be transferable between spouses and civil partners.
• The £1m allowance will cover:
  • Property in an estate at death.
  • Lifetime transfers to individuals in the seven years before death (failed potentially exempt transfers).
  • Chargeable lifetime transfers where there is an immediate lifetime charge (e.g. most transfers into trust).
• The new rules will apply for lifetime transfers on or after 30 October 2024 if the donor dies on or after 6 April 2026. 
• Where the ordinary rate of relief for agricultural property or business property is at 50%  (e.g. on quoted shares in company giving the transferor control) the rate of relief will not be affected by the new allowance. 
• The government will publish a technical consultation in early 2025.
• Policy paper: Agricultural property relief and business property relief reforms

Client briefings:  See IHT Business Property Relief and IHT Agricultural Property Relief

IHT on pensions

From 6 April 2027:

• At Autumn Budget 2024 it was announced that measures will make most unused pension funds and death benefits subject to Inheritance Tax.
• The policy intent to to align their tax treatment with other types of inherited assets and removing the incentive to use pensions as a tax-planning vehicle for wealth transfer after death.
• A technical consultation has been launched on the processes required to implement these changes for UK-registered pension schemes. This closes on 22 January 2025. 
• See Inheritance Tax on pensions: liability, reporting and payment

BPR on Alternative Investment Market (AIM) shares

From 6 April 2026: 

• At Autumn Budget 2024 it was announced that BPR will be reduced to 50% on shares designated as 'not listed' on the markets of recognised stock exchanges, such as the Alternative Investment Market (AIM). 
• This rate of relief will not be affected by the new £1m allowance above. 
• Policy paper: Agricultural property relief and business property relief reforms

See IHT Business Property Relief

Digitalisation of IHT services

• At Autumn Budget 2024 it was announced that government aims to invest £52 million in digitalising the IHT system from 2027-28 resulting in a modern, easy-to-use service which will allow for simpler submission of returns and payment of tax. 

Employee Ownership Trust (EOT)

From 30 October 2024

• For transfers into an EBT, three changes have been made to the conditions required to ensure transfers are exempt from Inheritance Tax. These changes include:
  • Restrictions on connected persons benefiting from an EBT apply for the lifetime of the trust.
  • The IHT exemption will be restricted if shares have been held for less than two years prior to settlement into the EBT.
  • No more than 25% of employees eligible to receive income payments can be connected to the participator.
• These are anti-abuse measures being introduced following the conclusion of the consultation process that commenced in July 2023.
• Policy paper: Changes to the taxation of Employee Ownership Trusts and Employee Benefit Trusts
• Consultation outcome: Taxation of Employee Ownership Trusts and Employee Benefit Trusts

See Employee Ownership Trust (EOT) 

Land & Property: rates and allowance

• No changes to Income tax rates and allowances for land and property.
• Rent a room relief remains at £7,500 per year
• The Property allowance remains at £1,000.
• The ATED charge increased from 1 April 2024 (see below)

CGT Rates and allowances & Residential Property disposals

From 6 April 2024

• The annual exemption for 2024-24 is £3,000 (£6,000 in 2023-24). Trust can claim half of this allowance.
• A reduction is proposed in the higher rate of CGT from 28% to 24% for sales of residential property.
• The lower rate of tax remains at 18% for any gains that fall within an individual's basic rate band.
• The basic rate for non-land and property is 10%, with a 20% higher rate.

See CGT: Residential Property Gains (subscriber guide)

Proposed abolition of the Furnished Holiday Lettings Tax Regime

From 6 April 2025 for Income Tax and Capital Gains Tax (CGT) purposes.

From 1 April 2025 for Corporation Tax purposes.

It was announced at the 2024 Spring Budget that the Furnished Holiday Letting (FHL)  regime would be abolished from:

• Draft legislation to effect the abolition of the FHL rules was published in July 2024.  This gives much greater detail on the expected changes and the transitional provisions that will apply.
• From April 2025, properties that previously qualified for FHL status will form part of the taxpayer’s UK or overseas property business as relevant. Such properties will then be subject to the same rules as non-FHL property businesses.

See Abolition of the FHL regime: Briefing

Incorporation relief: s162 TCGA 1992, business aassets, mortgages and liabilities

There are concerns as to whether some taxpayers are compliant with legislation for s162 incorporation relief.
This issue has been raised following Tax Policy Associates investigations of tax incorporation schemes promoted by Property 118 and it being pursued by the Chartered Institute of Taxation (CIOT)

• In February 2024, the Chartered Institute of Taxation (CIOT) wrote to HMRC seeking clarification on ESC D32, the meaning of 'business liabilities' and what amounts to such liabilities having been 'taken over' by the company on incorporation.The CIOT notes that lenders rarely allow novation these days. 
  
  
• In April 2024 the minutes of the Capital Taxes Liaison group noted that concerns were  raised about how incorporation relief should be applied and whether business liabilities for the purposes of D32 may include property mortgages associated with letting activities.  Noteing some confusion around the term “whole of the asset” and whether it related to the beneficial interest in the asset or the legal title as well.
  
  
• In September 2024, in its Budget respresentations, the CIOT wrote agaom the ESC D32 mortgage liability point but raised the all assets point: suggesting that a 'common' piece of planning carried out concerning property business incorporations is to transfer the beneficial ownership of the properties into the company, while the transferor(s) retain the legal title.

• Worth noting: in October 2023 HMRC issued Spotlight 63: Property business arrangements involving hybrid partnerships.’ which details an abusive hybrid business model which blends a corporate partner with a transfer of a beneficial interest in property into a partnership with the aim of securing mortgage interest relief and also sheltering individuals from higher rate relief.

See Incorporation relief: business and trades

Stamp Duty Land Tax (SDLT)

SDLT thresholds

From 1 April 2024:

• No changes to SDLT rates & allowances.

From 1 April 2025:

• The SDLT cuts effective 23 September 2022 are reversed: 
  • The nil-rate threshold reduces from £250,000 to £125,000 for all purchasers of residential property in England and Northern Ireland.
  • The increased nil-rate threshold paid by first-time buyers decreases from £425,000 to £300,000.
  • The maximum purchase price for which First Time Buyers’ Relief can be claimed decreases from £625,000 to £500,000.

See SDLT: At a glance, Stamp Duty Land Tax, rates & allowances

Abolition of Multiple Dwellings Relief (MDR)

From 1 June 2024

• The abolition of MDR from Stamp Duty Land Tax (SDLT) will take effect from 1 June 2024 
• Transitional rules mean that MDR can still be claimed for contracts exchanged on or before 6 March 2024, regardless of when completion takes place, subject to various exclusions.

See SDLT: Multiple Dwellings Relief  (subscriber guide)

Stamp Duty Land Tax:  Acquisitions by Registered Social Landlords and Public Bodies

• A technical change to the SDLT legislation to remove some out-of-date definitions will ensure public bodies will be removed from the scope of the 15% SDLT higher rate charge where the effective date of transaction (usually the date of completion) is on or after 6 March 2024.

See HMRC Stamp Duty Land Tax - acquisitions by registered social landlords and public bodies

Stamp Duty Land Tax First-time Buyers' Relief

• A change to the conditions for Stamp Duty Land Tax First-time Buyers' Relief from 6 March 2024 means certain individuals who were previously excluded from this relief will now be able to claim, bringing them into line with purchasers of residential freeholds and pre-existing leases using similar arrangements. 
  • Previously, individuals buying a new residential lease via a nominee or bare trust were unable to claim relief on their purchase because special rules that applied to these arrangements treated the nominee or the trustee as the purchaser and not the individual.  This meant that victims of domestic abuse who wished to use such arrangements to prevent former partners from finding their new address were unable to claim relief.

See SDLT:  First-time buyers (subscriber guide)

SDLT Freeports

• Land transactions relating to qualifying Freeport land will be exempt from SDLT. Relief must be claimed in a land transaction return on or before 14 October 2027.
• The effective date of the land transaction must be on or before 30 September 2026.
• SDLT relief for purchases of land and buildings within a Freeport tax site, subject to a ‘control period’ of up to three years and the land being acquired and used in a ‘qualifying manner’.

See Freeports: Tax breaks

SDLT Investment Zones

• Twelve new Investment Zones will be established across the UK. 
  • Further details of six English Investment Zones are now published: Greater Manchester, Liverpool City Region, North East of England, South Yorkshire, and West Midlands and Tees Valley.
• Businesses setting up in these zones will benefit from tax breaks including full SDLT relief for purchases of land or buildings which are:
  • Acquired for qualifying commercial purposes which includes development for commercial use.
  • Used for such purposes in a control period of up to three years.
• See Policy paper: Investment Zones update

See Investment Zones: Tax breaks

Annual Tax on Enveloped Dwellings (ATED)

The ATED charge has increased from 1 April 2024:

The annual charge is as follows and is payable in advance by 30 April:

• Returns are due for the year ending 31 March 2025 are due between 1-30 April 2024.
• Relief has to be claimed in a return

See Annual Tax on Enveloped Dwellings (ATED)

Business Rates

From April 2024, it is proposed that: 

• The small business multiplier in England will be frozen at 49.9p.
• The standard multiplier will be uprated by September CPI to 54.6p.
• The current 75% relief for eligible retail, hospitality, and leisure properties in England will be extended for 2024-25, and thereby eligible to receive support up to a cash cap of £110,000 per business.

See Business rates: What's new?

Business Rates: Improvement Relief 

Proposed from April 2024:

• The new improvement relief, announced at Autumn Budget 2021, will ensure ratepayers do not see an increase in their rates for 12 months as a result of making qualifying improvements to a property they occupy. 

See Business rates: what's new?

New residence regime: abolition of Non-domicile status & the Remittance Basis, IHT reform for Non-doms

From 6 April 2025: 

• The current non-UK domiciled regime which allows for income to be taxed on a remittance basis for non-UK domiciled taxpayers will be abolished and replaced with a new regime based on residence status.
• First time new arrivals to the UK will not pay UK tax on Foreign Income and Gains (FIGs) for the first four years of UK tax residence.
• There will be transitional rules which will allow individuals to be able remit income and gains arising before 5 April 2025 at a reduced rate and the rebasing of foreign capital assets they held on 5 April 2017
• Budget documents and draft legislation, see  Policy paper: Reforming the taxation of non-UK domiciled individuals and Tax changes for non-UK domiciled individuals  Policy paper
• See Non-Domiciled Individuals and Remittance Basis: Client Briefing

Transfer Of Assets Abroad (TOAA)

From 6 April 2024:

• Legislation in Spring Finance Bill 2024 will deem individuals who are participators in a close company, or a non-resident company that would be close if it were UK resident, as transferors. 
• This change will ensure that a transfer made via a company, in which the individual is an owner or has a financial interest, will be considered a ‘relevant transfer’ by that individual for the purposes of the TOAA legislation.
• Policy paper: Amendments to the transfer of assets abroad provisions

See Transfer of Assets Abroad

Tackling off-shore anti-avoidance

• At Autumn Budget the government issued a call for evidence, focusing on three specific areas of legislation: 

  • Settlements legislation
  • Transfer of Assets Abroad legislation
  • Capital Gains Tax legislation

  but also welcoming in wider comments and recommendations on other areas of personal tax offshore anti-avoidance legislation which could be consulted on as part of this review. 

• There will be no changes until at least the 2026/27 tax year.

• Budget documents: Call for evidence Personal Tax offshore avoidance

See Simplifying Offshore avoidance legislation: Call for evidence 

Sovereign immunity from taxation

From April 2024

• In July 2022, HM Treasury published a consultation ‘Sovereign immunity from direct taxation: consultation on policy design’ which outlines the government’s proposal to legislate for, and better target, the UK’s exemption from direct tax for foreign sovereign investors.

Devolved Taxes

Wales

The Welsh outline and detailed draft budget was published on Tuesday 19 December 2023. This set out the tax, spending, and financing plans for Wales for 2024-25. 

The final 2024-25 Welsh budget was published on 27 February 2024. 

The 2025-26 Welsh outline and detailed draft budget will be published on Tuesday 10 December 2024.

Income Tax

As announced at the 2023 Welsh budget, proposed for 2024-25:

• The Welsh Rates of Income Tax rate will remain at 10%.
• This will retain parity between the rates of Income Tax in Wales and England/Northern Ireland for the 2024-25 tax year, with rates being 20%, 40% and 45%. 

See Welsh Income Tax

Land Transaction Tax (LTT)

Two LTT consultations were launched at the 2023 Welsh budget. These explored: 

• Legislative amendments to provide relief from LTT for qualifying transactions within a designated special tax site as part of the Freeports Programme in Wales. This consultation closed on 18 February 2024. 
• Draft regulations to extend the LTT higher residential rates three-year exception and refund periods, where transactions are impeded by fire safety defects or where transactions are prevented by emergency restrictions.
  • Responses to this consultation were published in June 2024.
  • The Welsh Government concluded that the draft statutory instrument published in December 2023 should proceed largely as drafted. It was made law on 12 July 2024.

See Welsh Land Transaction Tax (LTT), Welsh LTT consultations and Welsh LTT consultation outcome

Consultation: LTT reliefs

• In April 2024, the Welsh Government published a consultation on proposed changes to LTT reliefs. The consultation closed on 19 May 2024.
• Alongside wider reforms, it was proposed that Multiple Dwellings Relief (MDR) would be abolished from 1 June 2024
• Responses were published in July 2024 with no changes being announced. The Welsh Government is continuing to investigate its options. 

See Consultation: Land Transaction Tax reliefs and Welsh LTT reliefs: Consultation outcome

Non-domestic rates

As announced at the 2023 Welsh budget, proposed for 2024-25:

• The increase to the Non-Domestic Rates (NDR) multiplier in Wales will be capped at 5% for 2024-25
• Support for retail, leisure and hospitality businesses will be given by way of 40% NDR relief for the duration of 2024-25, capped at £110,000 per business.
• A fund will be developed to provide support to eligible small to medium-sized businesses in the retail, leisure and hospitality sectors, with funding to be used during 2024-25 to invest in measures to future-proof their businesses.
• The Local Government Finance (Wales) Bill was introduced into the Senedd on 20 November.
  • This will provide the legislative basis required to implement non-domestic rates reform for Wales, along with three-yearly revaluations.
  • See Reforming Non-Domestic Rates in Wales below. 

See Draft Welsh Budget 2024-25

Visitor levy

As announced at the 2023 Welsh budget:

• Legislation for a visitor levy will be introduced into the Senedd by Autumn 2024.

See Draft Welsh Budget 2024-25

Reforming Non-Domestic Rates in Wales

• The Welsh government intends to move forward with the development of the proposals, including three-yearly revaluations, supporting information requirements, and improvements to the administration of rating lists.
• Powers will be sought to enable secondary legislation to implement changes in relation to reliefs, exemptions, varying the multiplier, and anti-avoidance measures.

See Consultation outcome: Reforming Non-Domestic Rates in Wales

Licensing of visitor accommodation & LTT changes

• A Consultation on licensing Welsh holiday accommodation followed, with an analysis of responses being published in July 2023. 
• In January 2024, the introduction of a statutory visitor accommodation registration and licensing scheme was confirmed. 

See Welsh visitor accommodation registration and licensing scheme

Consultation: Business Rates and self-catering accommodation in Wales 

From April 2023:

• In March 2022, the Welsh Government published “Consultation on draft Non-Domestic Rating (Definition of Domestic Property) (Wales) Order 2022”.
• This Order amends the criteria for self-catering accommodation to be liable to Business Rates rather than Council Tax.
• From April 2023, the availability requirement became 252 days (previously 140) and the letting requirement became 182 days (previously 70).

Consultation on private schools and non-domestic rates

• In September 2024, the Welsh Government launched a consultation on withdrawing charitable non-domestic rates relief from private schools from 1 April 2025.
• The proposal seeks to bring independent schools with charitable status in line with other independent schools in Wales.
• The consultation closes on 16 December 2024.
• Consultation: Charitable non-domestic rates relief for private schools

Scotland 

The 2023 Budget was held on Tuesday 19 December 2023. This set the Budget and spending plans for Scotland for 2024-25.

The 2024 Scottish Budget will be held on Wednesday 4 December 2024. This will set the tax and spending plans for Scotland for 2025-26.

Income Tax

From 6 April 2024:

• The Starter and Basic rate bands will be increased by inflation to £14,876 and £26,561 respectively.
• A new Advanced rate of 45% will be added for income over £75,000 (to £125,140).
• The Top rate will increase from 47% to 48%.
• All other rates and thresholds will remain at 2023-24 levels.

See Scottish Income Tax

Scottish Landfill Tax (SLT) 

Proposed from 1 April 2024: 

• From 1 April 2024, the standard rate of SLT will increase to £103.70 (2023-24: £102.10) per tonne and the lower rate of SLT will increase to £3.30 (2023-24: £3.25) per tonne. 

See Scottish Budget for 2024-25

Non-domestic rates

Proposed for 2024-25:

• The Basic Property Rate (poundage) will be frozen at 49.8p (2023-24: 49.8p). 
• The Intermediate Property Rate rises by inflation to 54.5p (2023-24: 51.1p).
• The Higher Property Rate also rises by inflation, to 55.9p (2023-24: 52.4p).
• 100% relief will be given in 2024-25 for hospitality businesses located on islands as defined by the Islands (Scotland) Act 2018, capped at £110,000 per business.
• The Small Business Bonus Scheme will be maintained. 
• The 90% renewables District Heating relief will be extended to 31 March 2027 and expanded to include all district heating networks where at least 80% of the thermal energy generated derives from renewables.
• Enterprise Areas relief, which was due to expire on 31 March 2024, will be phased out over 2024-25 and 2025-26.
• Telecommunications mast relief will be extended from 31 March 2029 to 31 March 2031.

See Scottish Budget for 2024-25

Scottish Framework for Tax

• In September 2021 the Scottish Government announced a Call for evidence seeking views on its draft Framework for Tax explaining the approach to tax policy for the new session of the Scottish Parliament.
• Responses were published in December 2021 when the final version of the Framework for Tax was published which sets out a programme of work for the rest of this parliament, to 2026.
• See Consultation responses: Scottish framework for tax

Visitor Levy (Scotland) Bill

From Spring 2026:

• In May 2024, the Scottish Government passed the Visitor Levy (Scotland) Bill.
• This Bill gives councils the power to charge a Visitor Levy on overnight stays in accommodation such as hotels, B&Bs and holiday lets. This cannot come into force until Spring 2026, at the earliest. 
• The money raised by local authorities will be ringfenced for reinvestment in services and facilities largely used by tourists and business visitors. 

See Scottish tourist tax bill passed

Land and Buildings Transaction Tax (LBTT): Additional Dwelling Supplement (ADS)

1 April 2024

• Following a Call for evidence and subsequent Responses, a Consultation was launched in February 2023 considering proposed legislative amendments to the ADS rules.
• Responses were published in January 2024. After minor amendments, the Land and Buildings Transaction Tax (Miscellaneous Amendments) (Scotland) Order 2024 was presented to the Scottish Parliament and, subject to parliamentary approval, is expected to take effect from 1 April 2024. 
• Changes proposed include extending ADS timelines from 18 to 36 months, disregarding certain inherited properties and small shares in properties for ADS purposes, providing relief from ADS on divorce or separation and relaxing the ADS repayment rules for joint buyers. 

See LBTT: Additional Dwelling Supplement

Consultation: Building Safety Levy

• In September 2024, the Scottish Government launched a consultation on the introduction of a Building Safety Levy.
• This levy would take the form of an additional charge on new residential development, to be paid by housebuilders, with revenues used to support the Scottish Government's work to remediate cladding in existing residential buildings.
• Consultation: Scottish Building Safety Levy: consultation on proposals

Chargeable Event Gains deficiency relief: Scotland

From 6 April 2024:

• Regulations were drafted in October 2024 to enable deficiency relief to be calculated by reference to income taxable at the Scottish advanced rate of Income Tax from 6 April 2024.
• Policy paper: Income Tax: The Scottish Rates of Income Tax (Consequential Amendments) Order 2024
• Draft legislation: The Scottish Rates of Income Tax (Consequential Amendments) Order 2024

See Investment bonds & tax

Scotland and Wales

New Investment Zones across the UK

• Twelve new Investment Zones will be established across the UK. 
• Businesses setting up in these zones will benefit from tax breaks including:
  
  • Stamp Duty Land Tax (SDLT), 100% business rates relief, enhanced capital allowances for plant and machinery and enhanced Structures and Buildings Allowance rate and a zero rate of Employers NICs for new employee

• Investment Zones tax reliefs would be extended from five to ten years. 
• The UK government will work in partnership with the Scottish and Welsh governments with the intention of delivering an extension to the Investment Zones programme in Scotland and Wales.

See Investment Zones: Tax breaks

Freeports

It was proposed in the 2023 Autumn Statement, that: 

• For Freeports in Scotland and Wales, the sunset date for the Freeport tax reliefs will be extended from five to ten years, subject to agreement with the devolved administrations.

See Freeports: Tax breaks

VAT

From 1 April 2024.

• The VAT registration taxable turnover threshold increases from £85,000 to £90,000
• The taxable turnover threshold is increased from £83,000 to £88,000.

See VAT registration thresholds and Registering for VAT and  Deregistration

VAT DIY Housebuilders: new information powers

From the date of Royal Assent to Spring Finance Bill 2024 

• Additional powers for HMRC to request further evidential documentation about a DIY housebuilder’s claim.
• HMRC policy paper: VAT DIY Housebuilders scheme power to request for evidence

See VAT DIY Housebuilders Scheme (subscriber guide) 

VAT energy-saving materials relief

From 1 February 2024, it is proposed that:

• Legislation will be introduced to expand the VAT relief available on the installation of energy-saving materials by extending the relief to additional technologies, such as electrical battery storage, water-source heat pumps, and fiverts, and to bring buildings used solely for a relevant charitable purpose within scope.
• This follows a consultation opened in March 2023, for which responses were published in December 2023. 

See Energy-Saving Materials and VAT and Energy-Saving Materials consultation responses

Electronic Sales Suppression (ESS)

• From 4 March 2024, interest is charged on the late payment/repayment of ESS penalties.

See Penalties: Electronic Sales Suppression

Interpretation of VAT and excise law

• A consultation closed in November 2023 on draft legislation in Autumn Finance Bill 2023 will clarify how VAT and excise law should be interpreted in light of changes made by the Retained EU Law (Revocation and Reform) Act 2023. 

VAT treatment of private hire vehicles

• In April 2024, HMRC opened a consultation on the VAT implications of the High Court rulings in Uber Britannia Limited v Sefton Borough Council and Uber London Limited v Transport for London. 
• The potential consequence of these decisions is that VAT-registered Private Hire Vehicle (PHV) operators in England and Wales would be required to charge VAT on all PHV passenger fares.
• The consultation, which closed on 8 August 2024, explores two potential VAT solutions: legislative amendment and targeted interventions. 
• At Autumn Budget 2024, the government said that it is considering the responses to the Recent consultation on the VAT treatment of private hire vehicle services and the impact of the recent Court of Appeal judgment. It will respond to the consultation in due course.

See VAT treatment of private hire vehicles consultation

VAT treatment of charitable donations

• In April 2024, HMRC announced that a consultation would be published before 23 July 2024 to explore the introduction of UK-wide VAT relief for low-value goods which businesses donate to charities, for those charities to give away free of charge to people in need.
• In the absence of a relief, VAT must be accounted for on such donations.

See Tax Administration and Maintenance Day 2024 at a glance

VAT on private schools

From 1 January 2025:

• Legislation in Finance Bill 2024-25 will remove the VAT exemption on private school fees.  
• All education services and vocational training provided by a private school or connected person in the UK for a charge will be subject to VAT at the standard rate of 20%. 
• Pre-payments of fees made from 29 July 2024 are subject to anti-forestalling provisions.
• Following a technical consultation on the draft legislation, a government response has been published.
• Policy paper: VAT on private school fees
• Technical consultation outcome VAT on Private School Fees & Removing the Charitable Rates Relief for Private Schools
  • Charging and reclaiming VAT on goods and services related to private school fees - guidance
  • Check if you must register for VAT if you receive private school fees - updated

See Private Schools & VAT

MTD: volunteers and penalties

From 6 April 2024,

• Taxpayers who volunteer to join MTD from April 2024 are subject to the government’s new penalty regime for late filing of tax returns and late payment of tax.
• These changes will apply new penalties to annual obligations only.
• Policy paper: Penalty Reform for Making Tax Digital for Income Tax Self Assessment volunteers

See Penalties: Late Filing MTD

Consultation: adjusting New penalties for failure to pay

A technical consultation was published in May 2024 for the proposed new Penalties for Failure to Pay Tax (Schedule 26 to the Finance Act 2021) (Assessments) Regulations 2024. It aims to close a perceived loophole in the rules. 

• Late payment penalties apply from 1/1/23 VAT and for MTD ITSA.
• HMRC can only assess second penalty when tax paid <2 years.
• Change means penalty cannot be avoided by delaying payment >2 years.
• The consultation closes on 10 June 2024

See New penalties for failure to pay tax

Criminal offences for promoters of tax avoidance

• Finance Act 2024 
  • Introduces a new strict liability criminal offence resulting in unlimited fines and a potential prison term of up to two years where there is evidence that there has been promotion in breach of a Stop Notice.
  • Gives HMRC the power to apply to the court for a disqualification order in respect of directors and other persons who control or exercise influence over a company which is involved in promoting tax avoidance and operating against the public interest.
• Consultatinon ‘Tougher consequences for promoters of tax avoidance’. 
• Responses were published in July 2023.

See Promoters of Tax Avoidance Schemes (POTAS)

Doubling maximum sentences for tax fraud

• Finance Act 2024 doubles the maximum sentences for the most egregious forms of tax fraud from 7 to 14 years.
• On 13 September 2023, the House of Lords Finance Bill sub-committee opened a Call for evidence which considers dealing with promoters of tax avoidance and increasing the maximum prison term for tax fraud. It closed on 6 October 2023.

See 14-year prison sentences for tax fraud

Reforming requirements to file a Self Assessment tax return

From 2024-25, it is proposed that:

• Individuals with income taxed only through Pay As You Earn will no longer be required to file a Self Assessment return.

See Autumn Statement 2023: At a glance

Improving the data HMRC collects from its customers

From 6 April 2025: 

• Under RTI, employers will be required to report the number of hours an employee has worked in respect of the payment reported under RTI. Where all or part of a payment does not have some data on hours, employers must tell HMRC by selecting the relevant descriptions from a list.
• Under SA, shareholders in Owner Managed Businesses (OMBs) will be required to provide the amount of Dividend income received from their company. This will be reported separately from other dividend income.
• The percentage shareholding in the Close company. Confirmation of whether they were a company director of a close company during the tax year.
• Under SA, Self-employed individuals will be required to provide start and end dates of their self-employment. This information is currently voluntary in the SA and the equivalents in Making Tax Digital (MTD).
• Open consultation: Draft legislation: Improving the data HMRC collects from its customers The consultation will close on 9 May 2024. 

See Additional Information required from OMBs

Consultation: Transparency of land ownership involving trusts: Responses awaited

• In December 2023, a consultation was launched which explores: 
  • Widening access to trust information held on the Register of Overseas Entities.
  • Addressing a lack of transparency around the identity of the parties that can control or derive economic benefit from UK land that is held via a trust structure. 
• Proposals range from making no change to the current availability of information, to publishing all information collected about trusts by default. 
• The consultation closes on 21 February 2024. Responses can be submitted online, or by e-mail.

See Consultation: Lifting the veil of secrecy for land-holding trusts

Tax administration framework

• HMRC has published a response to its consultation ‘Simplifying and modernising HMRC's Income Tax services through the tax administration framework’.
• A number of improvements and legislative changes are planned to promote a 'digital by default' approach and improve systems around tax codes.

See Tax administration framework: Consultation response

Call for evidence: HMRC’s enquiry and assessment powers

• In February 2024, HMRC launched a new Call for evidence ‘The Tax Administration Framework Review: enquiry and assessment powers, penalties, safeguards’.
• This explored wide-ranging possibilities for reform with respect to HMRC's powers, the penalty regime and taxpayer safeguards.
• Responses were published in October 2024. Further consultation will now take place on tackling high volumes of low-value non-compliance, behavioural penalties, and improving access to alternative dispute resolution and statutory review.

See HMRC’s enquiry and assessment powers: Call for evidence outcome

Raising Standards in the Tax Advice Market

• In March 2024 HMRC continued its consultation  'Raising standards in the tax advice market – strengthening the regulatory framework and improving registration' . This focuses on mandating tax registration for agents. It also outlines proposals for strengthening the regulations, its administration and enforcement. The new rules will affect 85,000 tax advice firms.
• In June 2024, the Professional Conduct in Relaton to Taxation (PCRT) group made a joint response confirming that they agree that mandatory registraton is a sensible first step.
• The government's response is awaited.

The Budget Responsibility Act

• In July 2024 a new fiscal lock was announced to ensure that any Government making significant and permanent tax and spending changes will be subject to an independent assessment by the Office for Budget Responsibility (OBR).
• The Budget Responsibility Bill subsequently received Royal Assent on 10 September 2024, becoming the Budget Responsibility Act 2024. It came into force on 15 October 2024 via Statutory Instrument.

See The Budget Responsibility Act 2024

Consultation: new ways to tackle non-compliance

• In October 2024, HMRC launched a consultation on 'New ways to tackle non-compliance' as part of its Tax Administration Framework Review.
• Views are sought on reforming HMRC's existing powers, such as the Revenue Correction Notice (RCN). New powers are also proposed, including the introduction of a partial enquiry power, and a requirement for taxpayers to self-correct errors.
• The consultation closes on 22 January 2025. 

See Consultation on new ways to tackle non-compliance

Consultation, 'Improving the effectiveness of the Money Laundering Regulations

• HM Treasury's March 2024 consultation, 'Improving the effectiveness of the Money Laundering Regulations' explores a wide range of steps for improving the quality of AML due diligence as well as filling gaps in disclosure of trust and land ownership as well as joining up gaps in information sharing. It also includes a survey.
• It closed in April 2024m responses are awaited. 
• See Improving the effectiveness of the Money Laundering RegulationsImproving the effectiveness of the Money Laundering Regulations

Economic Crime Levy (ECL)

From 1 April 2024:

• The rate at which entities with UK annual revenue greater than £1 billion will pay the ECL will increase from £250,000 to £500,000 per annum. 
• This was legislated in s.21 Finance (No. 2) Act 2024. 
• Policy paper: Economic Crime Levy charge increase for entities with UK revenue over £1 billion

Freeports

• The sunset date for the Freeport tax reliefs will be extended to 30 September 2031 for Freeports in England.
• For Freeports in Scotland and Wales, the reliefs will be extended from five to ten years, subject to agreement with the devolved administrations.

Soft Dringks Levy Review

Autumn Budget 2024:

• At Autumn Budget 2024, the government announced it is reviewing the Soft Drinks Industry Levy’s (SDLI) sugar content thresholds and the exemptions for milk-based and milk substitute drinks.
• The SDIL will be increased, over the next five years, to reflect the 27% CPI inflation between 2018 and 2024.
• Annual rate increases will take place from 1 April 2025 and will also reflect future yearly CPI increases. 
• Meetings will take place from December 2024 onwards and the review will conclude in Spring 2025. Depending on the outcome of the review, the Government would expect to enact any changes to the SDIL following Budget 2025.
• See HMT-HMRC Soft Drinks Industry Levy Review
  
  

Plastic Packaging Tax

From 1 April 2024:

• The rate of PPT will increase from £210.82 per tonne to £217.85 per tonne. 
• Policy paper: Changes to Plastic Packaging Tax rates from 1 April 2024

Autumn Budget 2024:

• At Autumn Budget 2024, the government published a response to its 2023 consultation ‘Plastic Packaging Tax – Chemical recycling and adoption of a mass balance approach’. The outcome is that it will undertake further technical engagement before confirming when the changes will take effect and publish draft legislation for technical consultation.
  • Plastic packaging tax - chemical recycling and adoption of a mass balance approach - consultation response

See Plastic Packaging Tax

Construction Industry Scheme (CIS) reform: reforms to the Gross Payment Status test

From 6 April 2024

• Compliance with direct and indirect tax (VAT, Income Tax Self-Assessment, Corporation Tax Self-Assessment and PAYE.) becomes a condition of obtaining CIS Gross Payment Status compliance test.
• HMRC has powers to remove Gross Payment Status immediately in cases of serious non-compliance.
• Regulations will be laid to set out exceptions to VAT compliance obligations and to remove the majority of payments made by landlords to tenants from the scope of the Scheme.  
  • Feedback on the draft regulations was sought by 9 January 2024: Construction Industry Scheme (CIS) proposed amendments
• Policy paper: Construction Industry Scheme reform from 6 April 2024
• This follows previous consultation. See Consultation on Construction Industry Scheme reform and Consultation responses on Construction Industry Scheme reform

See CIS: Contractors and Subcontractors