The Autumn Statement – what it means for you
The Chancellor of the Exchequer, Jeremy Hunt, has today unveiled his Autumn Statement. The budget announced a raft of measures aiming to fill a £54bn black hole in public finances, which are comprised of spending cuts and tax rises. These include:
- A reduction in the threshold at which the 45% income tax rate becomes payable, from £150,000 to £125,140;
- The annual exemption for Capital Gains Tax (CGT) will be cut from £12,300 to £6,000 next year and £3,000 in April 2024;
- Inheritance Tax Nil Rate Band (NRB) threshold of £325,000 to remain frozen until 2028;
- Stamp duty cuts to remain in place until March 2025
The reduction in the CGT allowance by over 75% over two years will be of great disappointment to many that have used Investments or Discretionary Trusts to provide for children and grandchildren. Many people will be rethinking the vehicles and instruments used to save and grow their capital, with beating inflation already a challenge in itself.
The freezing of the Inheritance Tax (IHT) threshold is a real terms cut, with the inflation rate at 11.1% in the October figures and house prices increasing by 9.5% over the year to September 2022.
Whilst £325,000 may sound a sizeable sum, the reality is that, following today’s budget, more and more estates will become liable to pay Inheritance Tax – a house increasing in value could be all that it takes to tip the estate over the threshold.
Mitigating your exposure to Inheritance Tax and Capital Gains Tax is something that our experts can help with. We can assist you in the drafting of your Will, setting up of Trusts and general Estate Planning and Management.
If these measures are likely to affect you, or you would like to understand the ways in which we can assist you, please give our Wills, Trusts and Probate team a call on 01202 057847 and we can discuss your circumstances.
How can we help?
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