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The Spring Budget is made by the Chancellor of the Exchequer in the House of Commons. It includes a review of the nation’s finances and economic situation as well as changes proposed by the government.
Here are some of the key announcements from the Spring Budget that may affect you:
National Insurance contributions for employees will be cut by 2p in the pound from 6 April 2024 – from 10% to 8% on earnings between £12,570 and £50,270. The government said this would mean the average worker would save over £450 a year.
‘Class 4’ National Insurance paid by the self-employed will also be reduced from 9% to 6%.
The amount of National Insurance you’ll need to pay depends on your employment status and how much you earn. Visit GOV.UK to find out more.
According to the chancellor, nearly 1 million households on Universal Credit take out budgeting loans to pay for more expensive emergencies like boiler repairs.
To make these loans more affordable, the repayment period for new loans has increased from 12 months to 24 months. The £90 charge for getting a Debt Relief Order (DRO) has also been abolished.
Please note – HSBC doesn’t offer budgeting loans.
The Household Support Fund, which allows local councils to help families who are struggling to afford things like energy bills, food, and essential items, has also been extended to September 2024.
From April 2024, full child benefits will be paid to households where the highest-earning parent earns up to £60,000, an increase from the current cut-off of £50,000.
This will mean fewer parents are hit by the High Income Child Benefit Charge.
A new rule to make the benefit apply to collective household income, rather than on an individual basis, is also expected to be introduced by April 2026.
The VAT registration threshold will increase from £85,000 to £90,000 to cut taxes for businesses and help them grow.
The chancellor announced his intentions for the replacement of the non-UK domicile tax rules with a residence-based regime from April 2025.
The government plans to publish a policy consultation on the proposed changes, followed by a draft legislation later in the year.
This applies to UK residents who have their permanent home (‘domicile’) outside the UK.
The duty on all alcohol, including beer, cider and wine, which was due to end in August is now frozen until 1 February 2025.
Fuel duty will remain at its current rate and will be frozen for the next 12 months.
The temporary 5p cut on fuel duty has also been extended, which is expected to save the average car driver £50 this year.
A new duty has been placed on vaping products from October 2026.
A one-off increase in tobacco duty will also be introduced.
Many people are eligible for government support but don’t realise it. You may think you need to be out of work to claim anything – but that’s not the case.
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The information in this article was last updated on Wednesday 6 March 2024.
