UK Budget 2024: Chairman’s Statement
Markland Hill Wealth are pleased to bring you our reaction to Labour’s tax and spending plans for the year ahead in the party’s first budget since coming to power over the summer.
Widely anticipated as a budget that might increase taxes across the board to boost public spending on health and infrastructure, the budget raised concerns amongst the business community already hampered in recent years by Brexit, the effects of COVID and rising costs.
Our chairman David Atherton gave his views exclusively through our website, on his initial views and analysis of today’s changes, concentrating on areas relevant to our clients.
David’s initial summary is as follows:
“We knew this would be a tax increasing budget and given the new government’s promise not to increase VAT or payslip costs, that inevitably savers and investors would be hit harder. The bulk of the tax raising has been applied to employer’s national insurance, but nevertheless, as expected, the Capital Gains Tax rate has increased, and the Inheritance Tax rules have been tightened. The CGT and IHT changes, unlike, say, tobacco duty is not immediate, but come in the next tax year starting in April.
The good points are that there has been no change to ISA allowance, pension limits or rules, meaning that planning in this area (including the all-important 25% tax-free withdrawal) can continue as before. Also, the Chancellor has helpfully given notice periods on many taxes before further changes will be made. Certainty is always a good thing.
The CGT increase does however highlight the need for further asset allocation planning, for example to move savings into CGT friendly vehicles such as VCT products where appropriate, and bonds become much more of a favoured planning tool than in previous years.
The surprise increase in Buy-to-Let stamp duty (enacted immediately, unlike the other rises), coupled with all the other punitive landlord measures in recent years may shift the balance between housing and conventional fund assets as a retirement sufficiency vehicle. Pensions would seem more attractive for later life income planning as property taxes rise’’.
Our team of qualified advisers are studying the detail of the changes and will be ready to assist our clients, but anyone with specific concerns can contact us immediately.
As a firm, we will be publishing more information as soon as we have the precise details of the changes and have digested them.