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Quick guide to Labour's tax plans

5th 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 article: Labour wins the election; what now for UK taxes?

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IT ratesNo change
IT thresholdsFrozen until 2028 for all
IT thresholds for pensionersRetain triple lock for pensioners, but no Triple Lock Plus
IT Marginal rateNo change
High Income Child benefit charge (HICBC) No change
Carried interest for investment managersTax rate to rise from 28% to 45%
Pension contributions tax reliefTo review the pensions landscape. (Not in the manifesto but has previously advocated cutting pension tax relief for high earners)
Pension lifetime allowanceWas going to reintroduce, but decided not to
Employee NIC ratesNo cuts or rises planned
Self-employed NICsNo cuts or rises planned
CGT ratesA rate change (aligned with income tax rates?) not ruled out in the manifesto
CGT private residence reliefNo change
CGT business asset disposal reliefWill be reviewed
Furnished Holiday LettingsScrap in April 2025?
Buy to let landlordsNo plans on this
IHT rates/thresholdsNo changes mentioned
Offshore TrustsEnd the use of offshore trusts that avoid IHT
IHT exemptions for agricultural/farmlandTo be closed or restricted (not confirmed in the manifesto)
IHT business relief for shares in an unlisted companyPlan to end the relief (not confirmed in the manifesto)
WEALTH TAXNo plans for one
NON-DOMSLess generous transitional relief for the April 2025 proposed changes
STAMP DUTYStamp Duty threshold to return to £300,000 on 1 April 2025. Plus increased surcharge for overseas buyers by 1% to 3%
BRITISH ISAWill push ahead with the measure
COUNCIL TAXBand changes and/or revaluation not mentioned in the manifesto

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CT ratesNo change
CT R&D reliefNo change per their 2024 Business Growth plan
CT Patent BoxNo change
CT Full expensingNo change
Annual Investment AllowanceNo change other than saying they will provide greater clarity on what qualifies for capital allowances
Business tax roadmapPublished within 6 months of the election
Employment AllowanceNo plans mentioned
Apprenticeship LevyReplace 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 WageLow Pay Commission to take account of the cost of living. Remove age bands so that all adults are entitled to the same minimum wage.
Business ratesReplace with a new property tax, and remove exemption for private schools
VAT on private educationYes at 20% (but maybe delayed until Sep 2025)
VAT thresholdNot clear
VAT rateNo change
TAX AVOIDANCE£5bn tax crackdown
WINDFALL TAX ON OIL COMPANIESWill increase the level of tax
FUEL DUTYNo mention in the manifesto, but a fuel duty increase has not been ruled out

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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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