Feefo

Call free today

Feefo

Frame 33492

Service rating

Spring Budget 2024: The latest rumours and predictions

Spring Budget 2024

As Jeremy Hunt prepares to unveil his 2024 Spring Budget, find out more about the latest predictions and rumours swirling with our quick guide

On 6th March 2024, the Chancellor, Jeremy Hunt, will present his Spring Budget. This is his opportunity to update us on the overall state of the UK economy and explain his fiscal plans. The Spring Budget 2024 also holds even more significance than usual as it may be the last issued by the current government ahead of the next General Election.

While the Spring Budget doesn’t usually come with big policy announcements and sweeping changes, the potential upcoming election may persuade the Chancellor to introduce new measures designed to swing votes in his party’s favour.

So, what might we hear announced on 6th March?

Tax cuts

Although Jeremy Hunt has downplayed suggestions that there will be widespread tax cuts, there are rumours that he might make changes to income tax, inheritance tax, and/or VAT for both individual taxpayers and businesses.

Inheritance tax is thought to affect only 4% of estates, but its general unpopularity could lead to rate cuts in the upcoming budget. Income tax thresholds for employed workers may also be increased (after being fixed since 2021/22), and small businesses might be given a boost if the annual VAT threshold is increased beyond the current figure of £85,000.

Simplification of ISAs

Several financial pundits predict that ISAs will be either simplified or amended as part of the Spring Budget 2024. Having been in place for almost 25 years, some legacy products are thought to be no longer fit for purpose, especially Lifetime ISAs. Hunt may announce an increase in the current £20,000 annual saving limit as well as reducing the early withdrawal charge applied to Lifetime ISAs from 25% down to 20%. It’s also rumoured that the minimum property price for first-time buyers saving their deposit in a Lifetime ISA will also increase to reflect the rise in house prices.

Child Benefit adjustments

The high-income child benefit charge threshold has been subject to criticism as its current setup penalises single-income families. Under the existing structure, a family with two earners and a combined income of £80,000 would be eligible to claim child benefits. However, a single parent or sole breadwinner with an annual salary of £70,000 would be deemed ineligible. This discrepancy may be addressed – and fixed – in the upcoming Spring Budget.

1% deposit mortgages

With inflation driving up mortgage interest rates and the rise in the cost-of-living eating into people’s disposable income, it’s become even more difficult for young; single; and low-income buyers to get a start on the property ladder. Introducing Government-backed 1% deposit mortgages could offer a solution, but there’s also a risk that this approach would be unpopular with voters as it doesn’t address the housing shortage and may lead to borrowers becoming saddled with unsustainable debt or in negative equity.

Fuel duty freeze

When petrol prices started increasing due to global events and escalating oil costs, drivers and businesses that rely on transportation of goods via road were impacted. A temporary 5p cut on fuel duty was introduced in 2022 but is currently due to end in March 2024. If the Chancellor chooses to announce a freeze on fuel duty and an extension the 5p cut, motorists could feel more favourable when the polls finally open.

Broadband cost increase prevention

As broadband becomes a household essential, it is predicted that the Chancellor could step in and cap the amount companies are able to charge for their services. This rumour may be due to the fact that the cost of broadband contracts rose by 17.3% last year, due to inflation. Introducing a price cap or reducing the amount a contract can increase by annually could help to protect the many people who rely on having affordable access to the Internat.

Wondering how the Spring Budget could affect your finances or if you need financial advice our team at My Debt Plan is here to help. Give us a call on 0161 660 0411 or send a message here

Share the Post:

Related Posts

Credit Score

Credit Score Pop Up Wording : An Individual Voluntary Arrangement (IVA) is a formal agreement with creditors to repay a portion of your debts over time, but it does have an impact on your credit score and it will be difficult to obtain further credit whilst on an IVA. Once an IVA is approved, it is recorded on your credit report and will typically remain there for six years from the date it starts.
However, it’s important to note this is the case for most debt solutions and your credit score will likely already have been affected by being in debt in the first place.
Once your IVA is complete you will get a fresh start to begin rebuilding your credit rating.

Fees

IVA costs are charged for the preparation of your proposal and the administration of the arrangement for the full term (usually 5 years) these costs are charged from the monthly contributions you make into the IVA and are not in addition. Costs will only be recovered on approval of your arrangement and once you commence making payments to it. The fees for preparation of the proposal to creditors and calling the meeting for creditors to vote on its approval are called nominees fees, the fees for running the arrangement once approved are called supervisors fees. There are also some expenses incurred in the running of the arrangement such as the registration fee and the statutory insurance that needs to be taken by law, these are called disbursements. For our arrangements, the total of all of these is £3,650 although this may be adjusted by creditors when they vote on whether to accept. No matter what the end total of costs come to, you can be rest assured that these will be taken from the monthly payment we agree with you.