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The Chancellor Rachel Reeves accused the previous government of leaving behind a £22 billion black hole in public finances in her speech last month. So, her first budget, which is set to be delivered in October, will be a painful one, meaning that tax hikes and exemption rate cuts must be anticipated. Here are the details of predictions of what could be included in the Autumn Budget.
What to Expect from the Autumn Budget 2024?
Due to the huge gap in funding, the government is looking for methods to raise government revenue. The government imposed some immediate cuts by scraping projects like the Stonehenge tunnel, universal winter fuel payments, and NatWest share sale. The Chancellor and the Prime Minister have both warned the public about the budget, claiming this is a difficult decision.
The Budget will be the first that Labour will be delivering in 14 years. It will most likely contain some information from the Labour’s manifesto pledges before the election. As promised, Labour will not increase the taxes on working people. However, this could be a blessing in disguise, as more people will be pushed into the higher rate tax brackets due to frozen thresholds, and the individuals will ultimately end up paying more taxes.
1. Capital Gains Tax
The government has claimed repeatedly that National Insurance, Income Tax, and VAT rates will not rise. However, they have made no such claims about Capital Gains Tax (CGT). Tax and property experts are anticipating a hike in CGT rates. CGT for residential property is currently at 18% to 24%. But it is highly likely that CGT rates will be raised to be in line with Income Tax rates.
2. Inheritance Tax
Another tax that is predicted to increase in rates is the Inheritance tax (IHT). The government could either raise the tax rate or reduce the tax-free threshold, which is also known as the nil-rate band. Currently, the Inheritance tax rate is 40% for properties above the nil-rate band, which is £325,000.
Or the government could impose a double death tax. This would mean imposing a Capital Gains Tax on top of the Inheritance Tax. Passing on assets to a family member only imposes Inheritance Tax, but with the double death tax rule, CGT could also be imposed, taking the total tax rate to 54%.
3. Stamp Duty Land Tax
The first-time buyer Stamp Duty Land Tax (SDLT) exemption threshold was increased from £300,000 to £425,000. But Labour has expressed that the threshold will be cut down to £300,000 before the election.
4. VAT on Private Schools
The VAT exemption for private schools has also been lifted. From 1 January 2025 the standard rate of 20% VAT will be applicable to private school fees.
5. Non-Dom Status
It is also predicted that the new government will agree with the previous government's decision to implement changes to tax rules and the abolition of the non-dom status. So, property investment experts are anticipating the replacement of non-dom status with a new residence-based regime.
Conclusion
Rachel Reeves will deliver her first budget on 30 October 2024. Reeves and Sir Keir Starmer have emphasised time and again about the difficult decision that will lead up to the Autumn Budget. With decisions, such as VAT on private school fees, already made public, experts are anticipating a tax hike on CGT, IHT, and other taxes.
To know more about the potential CGT hike and its effect on landlords read our article on “Landlords Rush to Sell Amid Possible CGT Hike In 2024 Budget”
- Will the Autumn Budget 2026 Raise Your Tax Bill? What’s Confirmed & What’s Not - 8 September 2026
- The Third-Party Data Behind HMRC’s Nudge Letters to Landlords - 25 August 2026
- Autumn Budget 2026 Timeline: The Key Dates to Watch - 21 August 2026
