Post-election tax review – what we do and don’t know 

The new Chancellor, Rachel Reeves, has announced that the Budget will take place on 30 October 2024.  It is likely to cover a lot of ground. 

It is interesting to note that it is being described as a Budget rather than Autumn Statement, suggesting that there might be more substance than might otherwise be the case. It may also signal a permanent shift from a Spring to Autumn Budget, something the Conservatives were going to do, until they changed their minds.  

The Labour Party’s election manifesto has given us an insight as to what we can expect in the Budget, but given the Chancellor’s reported £22bn fiscal ‘black hole’, there is a lot we don’t know.  

So, what might be in October’s Budget?

Register your place for our Autumn Budget webinar on Friday 1 November

What we know about the upcoming Budget

• VAT will be introduced on private school fees from 1 January 2025

• The government plans to further tighten the rules for UK resident but non-UK domiciled individuals  

• It also plans to change the rules for ‘carried interests’ for private equity.   

The government also plans to tackle the tax gap by tackling avoidance and strengthening HMRC’s powers, but this is something we hear from every government, irrespective of their politics.    

The Labour manifesto confirms that they will not increase Income Tax, National Insurance or VAT, and that Corporation Tax will not be higher than 25%.   

What we don’t know about the upcoming Budget

Labour have identified a £22bn ‘black hole’ in the public finances and have confirmed they will need to increase tax revenues, in addition to the reduction or deferral of expenditure which has been announced.  Knowing what won’t change, how might the government raise the money needed?  

The manifesto was silent on Capital Gains Tax, Inheritance Tax and taxation of pensions and relief on pension contributions, together with other more minor taxes.  The tax raised from Capital Gains Tax and Inheritance Tax is relatively modest in the context of the overall tax take, but the cost of tax relief on personal pension contributions is very significant.   

How will the government balance the need to raise money with their stated desire of growing the economy, and the need for individuals to provide for their own retirements, and not relying so heavily on the state?  Would an increase to Capital Gains Tax, with no relief for business owners and risk takers who would deliver growth in the private sector, stifle the growth that is needed in our economy? 

Over the coming months we will share our views on what might change for Capital Gains Tax, Inheritance Tax and the taxation of pension contributions and pensions themselves.   

Watch our Autumn Budget question time webinar, Friday 1 November 

Following the Budget announcement, our panel of specialists will be examining the announcements made by The Chancellor, discussing what these changes mean for you. They will also answer your questions in our live Q&A. 

Register your place here for this free online event