Another year another fresh batch of tax rules and regulations to get excited about.
No matter if you are a professional accountant, a self-employed professional, or simply want to keep up to date on any changes that could impact your own personal finances, the tax changes that are made by the UK Government every year are important to be aware of.
One way to keep in the loop is to hire a tax accountant, or you could read this article, its really up to you.
Remember, most changes to tax account at the beginning of the tax year, so more changes are likely to be on the way from April, but here is a list of some of the biggest changes that have taken place so far this tax year.
Income Tax Threshold
The base rate of income tax remained at the 20% mark in 2023/24 although there were some adjustments to tax brackets that impacted top earners.
The tax band for top level earners fell from £150k to around £125k dramatically increasing the number of UK citizens who found themselves in the highest bracket. In face, over 230,000 people were affected by the change.
Full Expensing
For businesses, one of the biggest changes this year, and going forward is the introduction of the full expensing scheme. This scheme replaces the previous super-deduction scheme and allows businesses to claim 100% capital allowance on any qualifying spend.
This scheme will be in place up until March 2026. The idea behind the scheme is to encourage innovation, boost business investment, and recharge the economy following a period of severe stagnation.
Research and Development Tax Credits
Talking of tax relief for businesses committed to innovation, Research and Development R&D relief rates rose this year to as much as 27% of all R&D expenditure.
This was great news for any business in the science and technology sectors, but more businesses than you might think do qualify for R&D credits and it is definitely worth consulting with your tax accountant to see if you could benefit given the size of the tax discounts that are on offer.
Increased Corporation Tax
From April 2023, the 19% corporation tax rate rose to 25% for any profits that exceeded £250k with a marginal rate of 26.5% for profits between £50,000 and £250k.
This change made it even more important than it already was for businesses to find themselves an expert tax accountant in 2024.
Reevaluating business structure
Did you know that the way your business is set up can have serious implications on how much tax you need to be paying?
A tax accountant can help you restructure your entire business if that is something that you are interested in doing, reducing the amount of tax that you need to pay without any sort of negative effect on your day to day activities.
We are one of the premier tax accountants in the UK and are always available if you have any questions about tax or your business structure.