This is the biggest change that will affect sessional GPs with children. Currently where income exceeds £50k for the highest earner of a couple, child benefit will be withdrawn partially until £60k of income where it will be repaid in full.
The limits are to be increased to £60k and £80k respectively so that a family with two children and a higher earner of £60k will be £2,213 better off.
The rules will change again in a few years so that it is household income that is looked at, rather than the higher earner which will remove the penalty for a stay-at-home partner where the other earns more than the single limit.
This does highlight the need to have registered for child benefit because there are strict limits on backdating. If you did not register when your children were born, do so now regardless of earnings levels, even if you immediately disclaim the benefit. You can then claim it from April 24 if the higher earner is less than £80k.
For the next few years, it is still sensible to allocate work between partners to keep each of you below the cut off limits, if at all possible. For example – one working full time and one at home may mean no child benefit – but both working part time could mean £2,213 of child benefit in a 2 child family.
Some other changes in the Budget that relate to individuals and partners:
- Reduction in the main rate of National insurance by 2% (from 10% to 8% on earnings between £12,570 and £50,270 for employees, and from the intended 8% down to 6% on earnings between £12,570 and £50,270 for the self-employed).
- Reduction in the higher rate of capital gains tax from 28% down to 24% on property sales (where not covered by the main residence relief) from 6th April 2024. This is based on exchange of contracts date NOT, completion date. So be aware of the potential saving of delaying if a sale is in the pipeline (versus the commercial risk of losing the sale of course).
- Abolition of furnished holiday lettings rules (so no benefit over long term lettings).
- Abolition of multiple dwellings relief for SDLT.
- Abolition of ‘non-domiciled’ status from April 25 and amendments to the tax residence system (for which details are still awaited).
- Increase in turnover level for VAT registration from £85k to £90k from 1st April 24.
- New additional £5,000 UK ISA allowance (for investment in UK business) on top of the existing ISA limits.
More detail will come out of the Budget when the Finance Bill is available and we have not included here anything relating to various non-tax duties (such as fuel duty, alcohol duty etc etc).
Honey Barrett is preparing a more detailed budget document – please get in touch if you would like to receive a copy.
