In the first Budget presented by the Labour Party since 2010, Reeves announced an extensive array of tax reforms designed to 'stabilise' public finances and facilitate increased government spending. Altogether, tax rises totalling £40 billion were announced - some expected, others less so.

In our latest podcast Peter Clements, Sarah Bond, Rose Swaffield, Josh Critchlow and Chris Gotch from our London tax team discuss the business tax measures they found most noteworthy in the Autumn Budget 2024, including:

• Headline Budget announcements, including:
  
  • increases in the capital gains tax (CGT) main rates and reforms to business asset disposal relief and investors' relief, accompanied by anti-forestalling measures;
  • an increase in employer National Insurance contributions by 1.2% from April 2025; and
  • an increase in the CGT rates for carried interest from April 2025, with more significant reforms expected to follow;
• Publication of the Corporate Tax Roadmap designed to provide stability for businesses and foster inward investment, including:
  • capping the headline UK corporation tax rate at 25%;
  • confirmation the permanent 'full expensing' capital allowance regime and existing R&D reliefs will be retained; and
  • plans to provide increased tax certainty to investors in major projects;
• Measures designed to 'close the tax gap', including:
  
  • an increase in the interest rate for unpaid tax;
  • targeted anti-avoidance measures applying with immediate effect; and
  • the recruitment of additional HMRC compliance and debt management staff; and
• Other changes to the UK's tax code, including:
  
  • confirmation the UK will introduce the Pillar Two undertaxed profits rule (the 'UTPR') for accounting periods from January 2025, along with the related repeal of the offshore receipts in respect of intangible property (or 'ORIP') rules;
  • the replacement of the remittance basis of taxation for non-UK domiciled individuals ('non-doms') with a new residence-based regime; and
  • confirmation of increases to the rate and duration of the Energy Profits Levy and the removal of the associated investment allowance.

In a rowdy House of Commons, the Chancellor delivered what will be his last Spring Budget before a UK general election widely expected to take place in autumn this year.  Further details on some of these measures are expected to follow on Tax Administration and Maintenance Day 2024 – confirmed as taking place on 18 April – but there were plenty of interesting points (and politics) in the tax policies included in this wave of announcements.

In our latest podcast Jill Gatehouse, Emily Szasz, Josh Critchlow and David Haughey from our London tax team discuss some of the tax measures they found the most noteworthy in the Spring Budget 2024, including:

• Replacing the current tax rules for non-UK domiciled individuals (so-called ‘non doms’) with a new residence-based regime;
• Changes to the transfer of assets abroad rules following the Supreme Court decision in Fisher to ensure this anti-avoidance regime cannot be bypassed by individuals transferring assets offshore via a UK company;
• The introduction of Reserved Investor Funds (RIFs), a new type of UK investment fund in the form of an unauthorised contractual scheme; and
• Other changes to the UK’s tax code, including:
  • Further reductions to NICs, benefitting both employed and self-employed workers;
  • On stamp duty/SDRT, new guidance on recently-enacted legislation restricting the application of the higher rate charge on the issue and certain transfers of UK shares and securities into clearance services or depositary receipt systems – but nothing further on the Stamp Taxes on Shares Modernisation proposal;
  • Delaying the sunsetting of the Energy Profits Levy, so that it will end in 2029 (or earlier if energy prices fall below levels set by the previously-announced Energy Security Investment Mechanism);
  • Establishing a new R&D tax relief expert panel tasked with ensuring relevant HMRC guidance remains up-to-date as industry develops; and
  • Consulting on the introduction a new UK ISA, giving individuals a £5,000 annual allowance to invest in certain UK-focussed assets on a tax-free basis.