The most hotly anticipated budget for a generation has been delivered by our Chancellor. It was the first such fiscal event of the new parliament and an opportunity to reform taxation to meet wider economic objectives.
It was the longest budget speech we can recall, with the first 15 minutes spent talking about the black hole this Government had inherited, then the announcement of a raft of tax changes, before commentary about how the investment in public services would help improve the services and raise standards.
We hosted an event with local business leaders at Kingsholm in Gloucester and whilst there little positivity in the audience about the impact the budget would have on growth, there was a consensus that the budget may not have been as bad as attendees had expected.
As usual, the devil is in the detail, and we have been trawling through the information we have to summarise the key impacts from the announcements.
Please contact us if you have any queries and would like some help with tax planning, and some predictions of how this might affect your business.
Freezing of Thresholds
Rachel Reeves has confirmed that the income tax thresholds will remain frozen until 2028/29 and at that point will rise. However, with an increase in the state pension rate of 4.1 percent for 2025, many who did not pay income tax beforehand (due to their earnings being less than the personal allowance) or who are currently basic rate taxpayers, will be pushed into tax. The £5,000 starting rate for savings will also remain the same which is having an impact with current interest rates on savings, but overall, more people will be liable to pay additional tax.
Fuel Duty
In an unexpected announcement, it was confirmed that there would be no increase in the rate of Fuel Duty. The temporary 5p cut in the amount of Fuel Duty was due to expire in April 2025 and many expected there to be an increase from then, but the rate of Fuel Duty will remain frozen for now, which will be a welcome boost for consumers and those operating in the transport industry or directly affected by it.
More articles to follow covering all aspects of the budget announcements…
If you have any questions about how the budget or its proposed reforms might affect you, do get in touch on 01242 776000 or tax@randall-payne.co.uk.
