The breakdown of the 2024 Autumn budget and its key points for clinics and practitioners.
Today, October 30, Chancellor Rachel Reeves made history as the first female chancellor to unveil the Autumn Budget, outlining Labour’s financial strategy for the first time in 14 years. Opening with a bold statement that the only way to stimulate economic growth is to "invest, invest, invest," Reeves introduced policies aiming to fund public services by raising taxes by £40 billion across the UK.
Key highlights for small business owners
Reeves’ budget proposes significant changes for small business owners, especially relevant to clinic and salon operators:
- National insurance contributions: Employers’ National Insurance contributions will rise from 13.8% to 15%. Additionally, the threshold for contributions has been lowered from £9,100 to £5,000.
- Employment allowance increase: The employment allowance has been raised from £5,000 to £10,000, which allows employers to claim up to £10,500 on their National Insurance bill, up from £5,000.
- Business rates discount: The current 75% business rates discount (due to expire in April 2025) will transition to a 40% discount, capped at £110,000.
These changes could impact clinic budgets and administrative strategies, with the government aiming to generate £25 billion through the lower NI threshold alone. However, with the increased employment allowance, around 865,000 small businesses won’t need to pay National Insurance next year. Reeves anticipates that over one million employers may pay the same or less in National Insurance, providing some relief for business owners.
The budget also signals a shift towards simplifying taxes and increasing digitalisation, which could alleviate administrative pressures on clinics, allowing them to focus more on core business rather than tax compliance.
For asesthetic practitioners and clinic employees
The budget outlines plans for minimum wage adjustments and income tax:
- Minimum wage: For workers over 21, the minimum wage will increase from £11.44 to £12.21 per hour in April 2025.
- Income tax and national insurance threshold freeze: In line with previous conservative budgets, these thresholds will remain frozen until 2028, intended to prevent automatic tax bracket increases as wages grow.
Despite concerns about rising contributions and changing business rates, the budget also emphasises long-term support for small businesses, promising that the higher employment allowance and tax simplifications will ease potential financial strains on the sector.
Today, October 30, Chancellor Rachel Reeves made history as the first female chancellor to unveil the Autumn Budget, outlining Labour’s financial strategy for the first time in 14 years. Opening with a bold statement that the only way to stimulate economic growth is to "invest, invest, invest," Reeves introduced policies aiming to fund public services by raising taxes by £40 billion across the UK.
Key highlights for small business owners
Reeves’ budget proposes significant changes for small business owners, especially relevant to clinic and salon operators:
- National insurance contributions: Employers’ National Insurance contributions will rise from 13.8% to 15%. Additionally, the threshold for contributions has been lowered from £9,100 to £5,000.
- Employment allowance increase: The employment allowance has been raised from £5,000 to £10,000, which allows employers to claim up to £10,500 on their National Insurance bill, up from £5,000.
- Business rates discount: The current 75% business rates discount (due to expire in April 2025) will transition to a 40% discount, capped at £110,000.
These changes could impact clinic budgets and administrative strategies, with the government aiming to generate £25 billion through the lower NI threshold alone. However, with the increased employment allowance, around 865,000 small businesses won’t need to pay National Insurance next year. Reeves anticipates that over one million employers may pay the same or less in National Insurance, providing some relief for business owners.
The budget also signals a shift towards simplifying taxes and increasing digitalisation, which could alleviate administrative pressures on clinics, allowing them to focus more on core business rather than tax compliance.
For asesthetic practitioners and clinic employees
The budget outlines plans for minimum wage adjustments and income tax:
- Minimum wage: For workers over 21, the minimum wage will increase from £11.44 to £12.21 per hour in April 2025.
- Income tax and national insurance threshold freeze: In line with previous conservative budgets, these thresholds will remain frozen until 2028, intended to prevent automatic tax bracket increases as wages grow.
Despite concerns about rising contributions and changing business rates, the budget also emphasises long-term support for small businesses, promising that the higher employment allowance and tax simplifications will ease potential financial strains on the sector.
