The Budget is back again – Labour’s first since winning the General Election in July 2024.

There’s been a lot of talk of a £22bn ‘black hole’ in the UK’s finances, the highest since the end of World War II.

With limited media leaks, we don’t know an awful lot about what’s to come. However, PM Keir Starmer has said, “Those with the broadest shoulders should bear the heaviest burden,” so that’s some indication.

Here’s what we can tell you so far.

When is the Autumn Budget 2024?

This year, the Autumn Budget falls on 30 October 2024.

What time will it happen?

It’s normally on shortly after 12:30pm, when Prime Minister’s Questions (PMQs) is over, and it will last around an hour.  

How can I watch the Autumn Budget 2024?

The Budget will be broadcast live on the BBC and streamed on ParliamentTV.

What could happen in the Autumn Budget 2024

Here are some of the announcements we could be seeing at the Autumn Budget.

Labour has voiced their pledge to freeze corporation tax at 25 per cent and keep full expensing as it is for the rest of parliament. They’ve also backed up their election pledge not to increase VAT, Income Tax and National Insurance.

This black hole needs to be filled in somehow, and these areas may be where we see changes.

Rise in National Minimum Wage

A core element of Labour’s Make Work Pay plan is to give workers a ‘genuine living wage’, with a view to paying all adults the same wage. The National Minimum Wage is set to increase to £12.21 (a 6.7 per cent increase) for adults over 21 from April 2025. For 18-20-year-olds, the minimum wage will go from £8.60 to £10. Meanwhile, apprentice wages will rise from £6.40 to £7.55 per hour.

Increase in employers National Insurance

Business minister, Jonathan Reynolds, hinted on Sky News’ Sunday Morning programme that the promise not to raise National Insurance “was specifically in the manifesto, a reference to employees”. This is the most clear-cut sign so far that there could be a rise for employers.

What effect could this have? Christy Wilson, tax lawyer at Katten Muchin Rosenman LLP, said: “Any increase in employer NICs will add to the overall expenses of businesses. Whilst it is the responsibility of an employer to pay its employer NICs, it is likely that the economic burden of an increase in employer NICs would ultimately be passed on to employees. A study conducted by the Institute for Fiscal Studies showed that, in the long term, two out of three employer NIC increases/cuts were shifted onto employee’s wages.”

Fuel duty increase

Rumours of a fuel duty rise have been swirling ahead of the Budget announcement. It is predicted to go up as much as 7p a litre. An end to the 5p per litre reduction that’s been in place since March 2022 is also a possibility.

George Holmes, managing director of business finance specialist Aurora Capital, reflects on what this could mean for small businesses: “An increase in fuel duty would hit small businesses hard, especially those in logistics, trades, and transport, where fuel is a non-negotiable cost. 

“Many SMEs are already grappling with rising operational expenses, and removing the temporary 5p fuel duty cut at a time when fuel prices are creeping back up could be crippling for some small companies that rely on their vehicles to operate.

“The government needs to consider the potential impact on SMEs and act through subsidies, investment in green technologies, or even targeted exemptions—otherwise, we risk seeing a significant slowdown in growth from this vital sector of the economy.”

Capital Gains Tax increase

Capital Gains Tax (CGT) rates are at historic lows, making it a more obvious target. It could be the case that Reeves increases the rate so CGT is taxed at the same level as income tax. There are other ways they can increase the burden of Capital Gains Tax, such as reducing the annual CGT exemption, which is currently at £3,000.    

Business Asset Disposal Relief

One arm of Capital Gains Tax is Business Asset Disposal Relief. As it stands, if you sell a business asset up to the value of £1m, then you’ll be taxed at a lower rate of 10 per cent. This limit could be reduced, but there’s speculation that it could be scrapped altogether.

Inheritance Tax (IHT) reliefs reduced or removed

IHT can be reformed in many ways. One such way is capping IHT relief for business and agricultural assets at £500,000 per person, according to RJP. Alternatively, the government might cap or reduce 100 per cent business relief, or they might tighten the criteria for business relief and agricultural relief.

Incentivising green investments

In line with the government’s climate targets, we could be seeing more business incentives for the likes of introducing renewable energy and boosting carbon reduction.

Business tax roadmap

Labour promised a ‘business tax roadmap’ within six months of being elected. It seems as if Budget day is going to be that day. It will map out what business tax is going to look like over the lifetime of this government.

Read more

Pros and cons of employee ownership trusts (EOTs) – In this article, we explain what an employee ownership trust is along with the pros and cons of moving to this model