The Chancellor's Budget: What to Expect
Strettons' summary of the October 2024 Budget and what it means for property owners, investors and businesses.
• Growth: the OBR forecasts real GDP growth of 1.1% in 2024 and 2% in 2025, easing to around 1.5-1.8% a year after that. It expects the Budget to push inflation and interest rates up in the short term.
• Stamp Duty: the surcharge on second homes, including buy-to-let purchases, rises from 3% to 5% from 31 October 2024. The temporary thresholds end in March 2025, when first-time buyers' nil-rate band falls from £425,000 to £300,000 and home-movers' from £250,000 to £125,000 - which may affect prices.
• Capital Gains Tax: rates on non-residential property rise to 18% (basic rate) and 24% (higher rate), from 10% and 20%, for sales completing on or after 30 October 2024. Residential rates stay at 18% and 24%.
• Business rates: relief for retail, leisure and hospitality falls from 75% to 45%, capped at £110,000 per business.
• Inheritance Tax: thresholds stay frozen until 2030, and inherited pensions come into Inheritance Tax from April 2027.
• Housing: more than £5 billion towards the target of 1.5 million new homes in five years; an extra £500m for the Affordable Homes Programme (around 5,000 homes); £50m to recruit 300 planners; smaller Right to Buy discounts, with councils keeping the full sale proceeds; and a five-year social rent settlement of CPI plus 1%.
• Non-doms: the non-domicile regime is abolished from April 2025.
Strettons' view: the measures bring both opportunities and challenges, and more detail is still to come, so clients should stay informed and plan for the effects over the next few years.
