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A quick and easy-to-read guide to the key personal and corporate tax policies of the new Labour government following the 4 July 2024 general election.
05 July 2024
A quick guide to the key personal and corporate tax policies of the new Labour government following the 4 July 2024 general election, as outlined in the manifesto of Labour.
See also our subsequent articles: Autumn Budget 2024 predictions, Labour wins the election; what now for UK taxes? and Autumn Budget date announced, and tax rises expected.
Tax | Labour |
| INCOME TAX (IT) | |
| IT rates | No change |
| IT thresholds | Frozen until 2028 for all |
| IT thresholds for pensioners | Retain triple lock for pensioners, but no Triple Lock Plus |
| IT Marginal rate | No change |
| High Income Child benefit charge (HICBC) | No change |
| Carried interest for investment managers | Tax rate to rise from 28% to 45% |
| PENSION TAX RELIEF | |
| Pension contributions tax relief | To review the pensions landscape. (Not in the manifesto but has previously advocated cutting pension tax relief for high earners) |
| Pension lifetime allowance | Was going to reintroduce, but decided not to |
| NATIONAL INSURANCE CONTRIBUTIONS (NICs) | |
| Employee NIC rates | No cuts or rises planned |
| Self-employed NICs | No cuts or rises planned |
| CAPITAL GAINS TAX (CGT) | |
| CGT rates | A rate change (aligned with income tax rates?) not ruled out in the manifesto |
| CGT private residence relief | No change |
| CGT business asset disposal relief | Will be reviewed |
| Furnished Holiday Lettings | Scrap in April 2025 |
| Buy to let landlords | No plans on this |
| INHERITANCE TAX (IHT) | |
| IHT rates/thresholds | No changes mentioned |
| Offshore Trusts | End the use of offshore trusts that avoid IHT |
| IHT exemptions for agricultural/farmland | To be closed or restricted (not confirmed in the manifesto) |
| IHT business relief for shares in an unlisted company | Plan to end the relief (not confirmed in the manifesto) |
| WEALTH TAX | No plans for one |
| NON-DOMS | Less generous transitional relief for the April 2025 proposed changes |
| STAMP DUTY | Stamp Duty threshold to return to £300,000 on 1 April 2025. Plus increased surcharge for overseas buyers by 1% to 3% |
| BRITISH ISA | Will push ahead with the measure |
| COUNCIL TAX | Band changes and/or revaluation not mentioned in the manifesto |
Tax | Labour |
| CORPORATION TAX (CT) | |
| CT rates | No change |
| CT R&D relief | No change per their 2024 Business Growth plan |
| CT Patent Box | No change |
| CT Full expensing | No change |
| Annual Investment Allowance | No change other than saying they will provide greater clarity on what qualifies for capital allowances |
| Business tax roadmap | Published within 6 months of the election |
| EMPLOYMENT TAXES | |
| Employment Allowance | No plans mentioned |
| Apprenticeship Levy | Replace the Apprenticeship Levy with a new Growth and Skills Levy |
| Employment status | Single status of the worker to redefine employment, with some employment rights to the 'genuinely' self-employed, including Statutory Sick Pay. No promise to look at IR35 or Off-payroll Working. There may be a consultation at some stage. |
| Minimum Wage | Low Pay Commission to take account of the cost of living. Remove age bands so that all adults are entitled to the same minimum wage. |
| PROPERTY TAXES | |
| Business rates | Replace with a new property tax, and remove exemption for private schools |
| VALUE ADDED TAX (VAT) | |
| VAT on private education | Yes at 20% (but delayed until 1 Jan 2025) |
| VAT threshold | Not clear |
| VAT rate | No change |
| TAX AVOIDANCE | £5bn tax crackdown |
| WINDFALL TAX ON OIL COMPANIES | Will increase the level of tax |
| FUEL DUTY | No mention in the manifesto, but a fuel duty increase has not been ruled out |
If you would like to discuss how the change of government may affect your taxes or those of your business, please contact your usual Bishop Fleming advisor.
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