Update | Budget, October 2024 – What Does it Mean for You?

Yesterday the chancellor delivered the Government budget. We have outlined below a summary of the key announcements affecting businesses.

While there are increases in taxes for businesses there is positive news about business rates with the intention to reduce the business rates for retail, leisure and hospitality from 2026-27.

The government has also committed to carrying out a review of the business rates system which we are looking to be involved in.

The chancellor acknowledged the sharp rise in shoplifting and will provide additional funding to ‘crack down on organised gangs which target retailers and provide more training to our police officers and retailers to help stop shoplifting in its tracks.’ Again this is good news and we will share any further details once these emerge.

Read on for further highlights from the budget.

Business rates

• Reform of business rates for high streets rolled out from 2026-27.
• 40% relief for retail, hospitality and leisure, up to a cap of £110,000 per business.
• Small business multiplier to be frozen next year.

Employers national insurance contributions

• National Insurance contributions will rise from 13.8% to 15%.
• The threshold at which businesses start paying National Insurance on a workers’ earnings will be lowered from £9,100 to £5,000.
• The employment allowance will increase from £5,000 to £10,500. 

Corporation tax

• Corporation tax to stay capped at 25%
• Small Profits Rate and marginal relief to stay at current rate and thresholds – no changes in corporation tax for SMEs.

Minimum wage and National wages changes

• This will rise in April 2025.
• The National Living Wage, for employees aged 21 and over, will rise from £11.44 an hour, to £12.21.
• If you are aged 18, 19 or 20, the National Minimum Wage will go up from £8.60 an hour, to £10.
• For those aged 16 or 17, the minimum wage will rise from £6.40 an hour, to £7.55.

Tax for employees

• From 2028-29, personal tax thresholds will be uprated in line with inflation.

Transport, alcohol and tobacco 

• The single bus fare cap applied to many routes in England will be raised to £3 in 2025, up from £2.
• Fuel duty will be freezed next year.
• There will be a flat rate duty on all vaping liquid to be introduced in 2026. 
• 10% on hand-rolled tobacco this year, introduce a flat-rate duty on all vaping liquid from 2026, and a one off increase in tobacco duty.
• Duty on draft alcohol will be cut.
• Alcohol duty rates on non-draught products will increase in line with RPI from February next year.

Inflation

• The OBR estimates that CPI inflation will average 2.5% this year, 2.6% in 2025, then 2.3% in 2026, 2.1% in 2027, 2.1% in 2028 and 2.0% in 2029.

We will share with you any further details as and when further information becomes available.

If you have any concerns or questions in light of the budget, please get in touch.