Autumn Budget 2024 deeper dive - Businesses

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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!