Expectations were high when Chancellor Jeremy Hunt stood up in the House of Commons to deliver his Autumn Statement. Speculation was rife in the run-up to it, with reports of possible inheritance tax cuts and income tax reductions.
The rumour mill was wrong. There were no such announcements. But there were still some noteworthy changes from the Chancellor – designed to help businesses grow, workers keep more pay and savers get better use out of ISAs.
Business rate relief and ‘full expensing’ to back business growth
Businesses appeared to be among the biggest winners. The Chancellor announced that the government’s policy of ‘full expensing’ for firms would become permanent. This allows them to effectively deduct what they invest in capital assets, such as IT equipment, plant or machinery, from their taxable profits. The government’s calling this “the biggest business tax cut in modern British history”.
Mr Hunt also said the current business rate discount of 75% for eligible retail, leisure and hospitality firms – areas that suffered particularly harshly during the pandemic – would be extended to the 2024/25 tax year.
You can have multiple ISAs
And there was good news for those looking to save and potentially grow their money for the future. The government has made the system around ISAs – a tax-efficient way to save or invest your money – simpler.
Irene explains, “Until now, you could invest in a number of different ISAs in a tax year – cash, stocks and shares, lifetime, innovative finance – but only one of each type. But from next tax year, you’ll be able to open more than one of each type, with no limit to how many you could have.
“This means, for example, if you start a cash ISA without using your full ISA allowance, you could start another at a different interest rate if you were to later come into some extra money. Or invest that extra money through a stocks and shares ISA. You can use different providers, and it’s all done in a tax-efficient way.”
That tax efficiency comes from the fact that, if you put up to a certain amount into an ISA in any given tax year, any returns it makes are free from income and capital gains tax. The limit on how much you can put in remains unchanged – it’s £20,000 in 2023/24 and will remain that for 2024/25.
That limit applies across all your ISAs. So even though you can have several of them now, you can still only save up to £20,000 in total across all of them to get the tax benefit.