Autumn Budget 2024 deeper dive - Businesses


There was a huge amount of information within the budget documents so here are the main points for businesses.


What hasn’t changed?

  • The main rate of Corporation tax is still at 25% and appears to be capped for the duration of this parliament

  • Full expensing on capital items and the £1m Annual Investment Allowance remain unchanged

  • Research and Development Tax Credits rates have not been changed 

  • VAT rates remain the same

  • Fuel Duty is frozen and the temporary 5p cut announced in March 2024 has been extended to 22 March 2026


Now for the changes…

Employers National Insurance:

The big news coming out of the budget for businesses, was the increase in the employer National Insurance rates. We have put together some simple calculators to assess the impact of these changes for your business, contact us here and we can send these over to you 


The headline changes on Employers National Insurance Contributions are :

  • From April 2025 the rate of contributions is increasing by by 1.2% from 13.8% to to 15% 

  • From April 2025 the threshold at which employers start to pay contributions on an employees salary reduced from £9,100 down to £5,000

  • To ease the burden of these increases the employment allowance is raised from £5,000 to £10,500 also from April 2025. There is no change to the restrictions on who can claim the employment allowance with Sole director companies still excluded and groups of companies only having one allowance between them

  • The increase in the employer's NIC rate also applies to Class 1A contributions paid on benefits in kind and Class 1B contributions paid on PAYE settlement agreements.

  • Salary sacrifice arrangements with employees can help reduce the impact of these rises

 

National Living Wage Increases from April 2025

  • The hourly rate for over 21’s  is increasing from £11.44 to £12.21 ph an increase of 6.7%

  • The rate for 18-20’s is increasing from £8.60 to £10ph

  • Under 18’s and apprentice rates are increasing from £6.40 to £7.55 ph


Company vehicles

  • Double cab pick ups - see our blog post here on these changes from April 2025

  • The 100% first year allowances for companies purchasing electric vehicles was due to come to an end in March 2025 but this has been extended for 12 months to March 2026.

  • Company car tax rates for company car drivers have been announced up to 2029/30. The percentages that apply up to 2028 are here. Electric car rates will increase by 2% each year, rising to 7% in 2028/29 and 9% in 2029/30.

  • The hidden surprise was for hybrid company car drivers whose percentage is calculated by reference to the number of zero emissions miles their vehicle can do. This condition is being removed and all hybrids will have a fixed percentage of 18% for 2028/29 and 19% for 2029/30 an increase of 13% for the worst hit!

  • All other company car rates will increase by 1% each year.



As always, get in touch if you need any help or have questions!


Autumn Budget 2024 deeper dive - Individuals

There was a huge amount of information within the budget documents so here are the main points for individuals.


What hasn't changed

  • Income tax rates and thresholds remain the same and continue to do so until 2028/29. The government have said that they will then rise in line with inflation reducing the “fiscal drag”

  • Employees and self employed  National Insurance contributions rates have not changed.

  • The abolition of the Furnished holiday letting regime is still going ahead from April 2025.

  • There have been no changes to tax relief on pension contributions or the ability to draw a tax free lump sum from your pension pot. 

  • ISA investment limits remain fixed at their current levels until 2030.

  • High Income child benefit charge (HICBC) - The previous government proposed in the spring budget to move to a household income based charge rather than the current charge based on the highest earners income. It was confirmed in the budget that this proposal will not be considered further and the current system will remain unchanged. The increased income threshold of £60,000 for 2024/25 onwards hasn't been changed.




Now, for the changes….



Capital Gains Tax

It was expected that Capital Gains Tax rates would increase and this was confirmed in the Autumn Budget. Here are the new rates:

  • The lower rate of 10% for basic rate tax payers has increased to 18% and the higher rate of 20% for higher rate taxpayers has increased to 24% with effect from budget day - 30 October. This change aligns the rates with the higher rates for disposals of residential properties so we are back to having just the two rates again.

  • Business asset disposal relief - this relief applies where an individual disposes of their business, or shares in their qualifying company, and previously the rate was 10% on the first £1m of gain and 20% thereafter. The lifetime limit of £1m remains but the rates of tax are going up as follows

    • Disposals between budget day and 5 April 2025 - no change - 10% on first £1m of gain then 20%

    • Disposals between 6 April 2025 and 5 April 2026 - 14% on first £1m of gain and then 24%

    • Disposals after 6 April 2026 - 18% on first £1m of gain and then 24%





Inheritance tax

The major change here is for businesses owners and farmers. Previously the value of qualifying business property (shares, land and business assets) was relieved from Inheritance tax. From April 2026

  • Business property relief and agricultural property relief will be 100% of the first £1m of asset value

  • Relief is restricted to 50% on the asset value over £1m giving an effective IHT rate of 20%

  • Business property relief is also restricted to 50% on unquoted AIM listed shares (previously 100%) 

Another change to be aware of, Inherited pensions funds are generally outside of a person's estate for Inheritance tax purposes however from April 2027 these funds will become part of a person's taxable estate and subject to Inheritance Tax at 40% (on current rates)


Stamp Duty Land Tax (SDLT)

The additional rate for the purchase of any additional residential properties increased from 3% to 5% from 31 October 2024



Non UK domiciled individuals

The current regime is being scrapped in favour of a residence based scheme. This is a really complex area which requires specialist advice so we won't go into the details but it will apply to individuals arriving in the UK and becoming resident in the UK with overseas income and gains. 



Making Tax Digital for Income Tax (MTD for ITSA)

It is now confirmed that MTD for ITSA will go ahead from April 2026 after a number of delays.

MTD will affect individual sole traders and landlords with those having a combined turnover of £50,000 or more in the 2024/25 tax year joining the scheme from April 2026. In April 2027 those with combined turnover of £30,000 or more will join the scheme. The government confirmed those with combined turnover of £20,000 or more will eventually join but the date is unconfirmed. Check out our MTD blog for more detailed information.



Contact us to chat about any of the budget announcements or your personal tax situation.


Dext - New features alert!

Here at Lodestar, we know that time is your most valuable resource.

Running a business means balancing multiple tasks everyday—and when it comes to accounting, it can often feel like you’re drowning in paperwork and receipts. 

When we look after your bookkeeping, you will be set up onto a software called Dext. Recently, Dext has introduced some fantastic new features that can save you even more time, reduce manual errors, and make your financial management smoother and more accurate.


In this blog post, we’ll walk you through some of the latest updates coming to Dext and explain how these new tools can help your business stay organised and efficient.



Upload PDF Files Directly via the Dext Mobile App

As a business owner, you're probably always on the go. Whether you're meeting clients, attending events, or managing daily operations, you don't always have the time to sit down at your desk to process your receipts and invoices. But now, with Dext’s new mobile app feature, uploading PDF files has never been easier. 

Using the in-app gallery (available on both iOS and Android devices), simply snap a photo or select your PDF file and send it directly into Dext’s secure system.

Dext has also added Share Sheet importing - with just a few taps, you can select and upload documents straight to your Dext account, whether they’re saved in your cloud storage, local file system, or elsewhere.




Track Your Mileage with Ease Using Dext


Dext’s Mileage Tracking feature allows you to easily track and log the miles you drive for business purposes, so you never miss out on potential tax deductions. Whether you’re attending client meetings, running errands, or driving between business locations, you can automatically record your mileage, making it easier to track your business vehicle use.

Some of the key features include:

  • Automatic Trip Logging with GPS tracking

  • Simple Categorisation

  • Customisable Rate for Tax Deductions

  • Manual Entry Option

Whether you’re driving a company car or using your personal vehicle for business, Dext’s Mileage Tracking feature ensures you don’t miss a mile. With automatic tracking, easy categorisation, and quick reporting, Dext takes the hassle out of mileage logging and makes sure you can claim every eligible mile when tax time comes.




If you need help getting started with Dext, have questions about any of the latest features, or need assistance with your general bookkeeping, our team is ready to support you every step of the way.

 




Double Cab Pickups - car or van? It depends.... (and it's changed!)

What is a Double cab pickup?

It is a vehicle that has a front passenger cab with a second row of seats to fit around 4 passengers plus the driver. It has 4 separate doors, and an uncovered pickup area at the rear.


These have been a popular purchase for businesses to use as company vehicles. They are big enough to use as a work vehicle yet also suitable for day to day personal/family use.

And…as long as the model chosen had a payload of at least 1 Tonne, it could be treated as a commercial vehicle for company tax purposes, making it a tax efficient option as well as a practical one.

Earlier this year there was a decision to change the tax treatment of these vehicles by HMRC that was very quickly overturned.

However, in the October budget, it has been reviewed again and from April 2025 these vehicles will now be taxed as cars.

This means: 

  • Lower Capital allowances- No first year allowances or Annual Investment Allowances.

  • Benefit in Kind value will be higher - The benefit will be based on the value of the vehicle, its fuel and its emissions, rather than the flat rate for commercial vehicles. This will cost the company more in Class 1A National Insurance, and the user of the vehicle will have a higher personal tax bill.

In short, it will become much less tax efficient to have a double cab pickup as a company vehicle


Any purchase of double cab pickups before 1 April 2025 will still be treated under the old rules..

For Benefit in Kind purposes,  there will be a transitional arrangement meaning a double cab pick up purchased prior to 1st April 2025 can be treated as a commercial vehicle until the earlier of - its disposal, the lease expiry or 5th April 2029.


So… if you were thinking of getting a double cap pickup, it may be worth doing so before 1st April 2025.