A big announcement week for Rachel Reeves - 30th July 2024

The UK Chancellor, Rachel Reeves, and the Treasury have announced some significant changes this week. Here are the key messages:

*The Autumn budget has been set for 30th October

*Increases to income tax, national insurance and VAT have been ruled out (so watch out capital gains tax, inheritance tax and pensions)

*VAT on school fees effective from 1st Jan 2025 and the removal of charitable rates relief (council tax) for private schools. Plus, with anti-forestalling measures that mean ‘Any fees paid from 29 July 2024 pertaining to the term starting in January 2025 onwards will be subject to VAT.’

*Abandoning the planned October 2025 launch of the (long-delayed) capped social care funding scheme in England, which proposed to cap care fees at £86,000.

*The winter fuel payment for pensioners is now means tested.

*Confirmation that the pension triple lock would remain in force, a manifesto pledge which is likely to mean a c. 5% increase to state pension payments next April.

*The end of excluded property trusts to keep assets outside of UK inheritance tax. Plus, Jeremy Hunt’s proposed 50% reduction in foreign income subject to tax for individuals who lose access to the remittance basis in the first year (2025/26) of the new regime will not be carried forward.

*A call on evidence on the favourable tax treatment of carried interest.

*Confirmation of a manifesto pledge to increase the Oil and Gas Profits Levy from 75% to 78%, extend its life by one year to March 2030 and, perhaps most significantly, scrap the 29% investment allowance for certain related expenditure. The changes will take effect from November 2024.