Budget 2024: Key Points for Property Professionals

Charlie Mallinson, Associate

On 30^th October 2024, Rachel Reeves, Chancellor of the Exchequer, announced the Autumn Budget 2024, in this brief summary, Charlie Mallinson sets out some of the key points which will concern individuals and companies involved in the property sector.

Business Rates

• The government intends to introduce permanently lower business rates multipliers for eligible high-street retail, hospitality and leisure properties from 2026-27.
• The government intends to introduce a higher multiplier for the most valuable properties, which will also take effect from 2026-27
• During the interim period (for 2025-26):
  • the small business multiplier will be frozen at 49.9p.
  • high-street retail, hospitality and leisure properties  will receive 40% relief (up to £110,000 per business).
  • The standard multiplier will be uprated by the September 2024 CPI rate to 55.5p.
• A discussion paper has been published where business can contribute their thoughts towards the government’s proposals.

Capital Gains Tax

• The main rates of CGT are currently charged at a lower rate of 10% and a higher rate of 20%, and these will be increased to 18% and 24% respectively from 30 October 2024.
• There are no changes to the residential property rates.
• There are two reliefs which offer access to a lower rate of CGT: Business Asset Disposal Relief (BADR), and Investors’ Relief (IR). The rate for both BADR and IR will increase gradually, to give business owners time to adjust to the changes. The BADR and IR rates will rise to 14% from 6 April 2025, and will match the main lower rate of 18% from 6 April 2026.
• The lifetime limit for Investors’ Relief will be reduced to £1 million for all qualifying disposals made on or after 30 October 2024, matching the lifetime limit for Business Asset Disposal Relief. This will be legislated in Finance Bill 2024-25.

Property Relief

• The government will reform agricultural property relief and business property relief from April 2026. In addition to existing nil-rate bands and exemptions, the 100% rate of relief will continue for the first £1 million of combined agricultural and business assets to help protect family farms and businesses, and will be 50% thereafter.
• The government will also reduce the rate of business property relief to 50% in all circumstances for shares designated as “not listed” on the markets of a recognised stock exchange, such as AIM.

Stamp Duty Land Tax (SDLT)

• The Higher Rates for Additional Dwellings of Stamp Duty Land Tax  will be increased from 3% to 5% from 31 October 2024. These higher rates apply to purchases of second homes, buy-to-let residential properties and companies purchasing residential property
• Those who exchanged contracts prior to 31 October 2024 are not affected by this rate increase.
• There are no changes proposed to the non-residential Stamp Duty Land Tax rates.

Planning

• The government will implement legislative changes to ensure a simplified and streamlined planning system. This will be introduced through the Planning and Infrastructure Bill and no further details are available at present.

Development

• The government has announced plans to provide an additional £3 billion of support for SMEs and the Build to Rent sector, in the form of housing guarantee schemes, allowing developers to access lower‑cost loans and support the delivery of tens of thousands of new homes. Further details will follow in due course.

Source: Autumn Budget 2024 (HTML) – GOV.UK