In October 2024 the Chancellor of The Exchequer, Rachel Reeves, announced the autumn UK budget for the UK. The budget will have an effect on everyone in East Dunbartonshire, whether directly through added tax on business, or indirectly through the products we buy. Here is an overview of some of the main points of the budget, and how it might affect you.
What is the Budget?
The UK Government holds at least two budgets each year, one in spring and one in summer. This is when the government looks to raise or lower taxes in order to have enough money to spend on issues like paying for the NHS, police and national defence. It can do this in many ways, including directly taxing the money we earn through work or increasing the tax we pay when we buy items or services. However, taxes can go down as well as up so budgets can sometimes mean more money in our pockets at the end of the month.
Wages & Pensions
The legal minimum wage for over-21s will rise from £11.44 to £12.21 per hour from April 2025. This works out at £1,400 more each year for full-time workers. The rate for those aged 18-20 will also rise, from £8.60 to £10 per hour.
The potential allowance paid to full-time carers will rise from £151 to £195 a week.
Finally, basic and new state pension payments to go up by 4.1% in 2025.
National Insurance
Working people will not pay any more National Insurance than they currently do. Instead, employers will raise National Insurance contributions from April 2025, meaning businesses will have to pay more instead. Whilst this will not have a direct impact on employees, some employers have warned that these increased costs may result in layoffs when they can afford to pay extra money.
Income tax
Income tax band thresholds will rise in line with inflation after 2028. This means that many people will not be dragged into higher bands as their wages rise, so will not have to pay more tax.
Smoking, vaping & alcohol
A new flat-rate tax of £2.20 per 10ml of vaping liquid will be introduced from October 2026. Meanwhile, tax on will tobacco to increase by 2% above inflation, and 10% above inflation for hand-rolling tobacco.
Tax on non-draught alcoholic drinks will increase, but tax on draught drinks will be cut by 1.7%.
Farming
From April 2026, inherited agricultural assets worth more than £1m, which were previously exempt, will be subject to inheritance tax at 20%. This has led to concerns that some farms will have to shut down, which may push up the cost of living.
Has the budget affected you?
If you are unsure if or how the budget has affected you, then come and have a chat with us. We are here to help, and offer free, impartial advice. The autumn UK budget on a national level can often mean we need to change our own personal budget to make sure we don’t fall into debt, and this is also something we can help you with. Speak to us today.
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