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Navigating Recent Tax Changes in UK: InBrief

In the ever-evolving landscape of tax legislation, staying abreast of the latest changes is crucial for accountants and bookkeepers. The week ending 13 March 2024 has brought several noteworthy updates from the realm of tax news, including legislative adjustments, updates on tax relief, and new guidance from HMRC. Here's a concise overview tailored for our accounting community, designed to keep you informed and ahead of the curve.

National Insurance Contributions: A Welcoming Cut

The introduction of the National Insurance Contributions (Reduction in Rates) (No. 2) Bill to the House of Commons marks a significant development. Effective from 6 April 2024, this legislation ushers in a reduction for class 4 and employees' class 1 NICs. The new rates are set at 8% for class 1 NIC and 6% for Class 4 NIC, a move announced in the Spring Budget 2024. This change aims to alleviate the financial burden on individuals and foster a more conducive environment for business growth and employment.

Enhancements in R&D Tax Relief and More

Recent secondary legislation has introduced adjustments across various domains, including R&D tax relief, PAYE, and CIS:

  • For Northern Ireland's SMEs: The Research and Development (Chapter 2 Relief) Regulations 2024 spotlight additional relief for loss-making, R&D-intensive SMEs, effective from 1 April 2024.

  • Creative Sector Claims: With the Relief for Creative Industries (Additional Information Requirements and Miscellaneous Amendments) Regulations 2024, claims for creative sector tax reliefs must now be electronically filed, detailing the required supportive information, starting 1 April 2024.

  • PAYE Adjustments: The Income Tax (Pay As You Earn) (Amendment) Regulations 2024 modifies the treatment of salary advance payments, coming into effect on 6 April 2024.

  • CIS Updates: The Income Tax (Construction Industry Scheme) (Amendment) Regulations 2024 introduces VAT return submissions and payment obligations under CIS, alongside specific exemptions, effective from 6 April 2024.

HMRC's Latest on ISAs

The HMRC's newly released Tax-free savings newsletter offers crucial insights for ISA managers and child trust fund providers. It encompasses updates from the Autumn Statement 2023, effective 6 April 2024, and discusses the consultation on the new UK ISA announced at Spring Budget 2024. This guidance is pivotal for those managing ISAs and CTFs, ensuring compliance and maximization of benefits under the new regulations.

Italian VAT Refunds for UK Businesses

In a significant development for UK businesses engaged in Italian operations, the Italian government has now enabled claims for refunds on VAT paid for goods and services related to their business activities in Italy. This new directive, applicable retroactively from 1 January 2021, simplifies the process by eliminating the need for a tax representative. Businesses are encouraged to consult the Agenzia delle Entrate's website for detailed instructions on claiming these refunds.

Other Important Changes:

a) Extension of the Energy Profits Levy

The termination date for the Energy Profits Levy (EPL) is extended to 31 March 2029. Concurrently, the government will legislate the energy security investment mechanism (ESIM) to suspend the EPL if energy prices revert to historically normal levels.

b) Introduction of Reserved Investor Funds

Legislation will soon introduce Reserved Investor Funds (RIFs), a new investment fund category for professional and institutional investors, alongside provisions for detailed tax rules.

c) New Individual Savings Accounts Proposal

The government proposes a new UK ISA, allowing an additional £5,000 yearly allowance over the existing ISA limit, with consultations pending on its implementation.

d) Modifications to Gift Aid Legislation

Amendments to the gift aid legislation will ensure charities' compliance with the Digital Markets, Competition, and Consumers Bill, aiming for implementation coinciding with the bill's enforcement.

e)Addressing Non-compliance in the Umbrella Company Market

Updates from a recent consultation on the umbrella company market will be shared on Tax Administration and Maintenance Day, with new guidance expected in summer 2024.

f) Easing Inheritance Tax Payments Before Probate

From 1 April 2024, estates' personal representatives will not require commercial loans to pay inheritance tax before obtaining a grant on credit from HMRC.

g) Simplification of Income Tax Payment in Instalments

HMRC aims to enhance digital services for paying income tax self-assessment liabilities in instalments, with improvements starting from September 2025.

h) Boosting HMRC's Debt Management Capacity

A £140m investment in HMRC's debt management will engage more debt collection agencies, anticipating an increase of £4.3bn in tax revenue by 2028/29, despite a slight increase in HMRC debt levels as of December 2023.

i) Tax Simplification Metrics

HMRC will utilize its annual customer survey to develop metrics measuring progress in tax simplification efforts, focusing on the net change in cost to businesses for meeting tax obligations.


These budget tax changes represent a mix of opportunities and obligations that can significantly impact how accountants and bookkeepers manage their responsibilities and advise their clients. From the NIC cuts offering financial relief to the detailed requirements in claiming creative sector tax reliefs and managing ISAs, it's crucial to understand these changes deeply. Additionally, the opening up of Italian VAT refunds presents a valuable chance for businesses to recover costs, potentially enhancing profitability.

Staying informed and adapting to these changes is not just about compliance; it's about seizing opportunities to optimize financial outcomes for your clients and your practice. As your partners in navigating the complexities of tax legislation, we're here to support you with insights and guidance tailored to the needs of the accounting and bookkeeping community.

# the spring budget, budget spring, spring budget 2024, spring budget summary, UK Spring Budget, UK Taxation


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