Chancellor Rachel Reeves presented its first Budget this week, which included around £40 billion in tax rises and major plans to increase spending in areas such as the NHS and defence.

Ms Reeves insisted the tax increases would “repair the foundations and wipe the slate clean”, adding: “Because of what we’ve done, we won’t have to come back and do a budget like this again . because we brought it all out into the open.

Some of the changes she announced this week have already come into effect, while others are unlikely to impact you for several years to come.

Here are all the changes announced in the budget that could affect you, along with the date they will come into effect.

From now on

Stamp duty changes – From October 31, the stamp duty The property surcharge for second homes will increase from 3 percent to 5 percent. The Chancellor said it would help 130,000 people who are moving or buying their first home.

Increase in tobacco duties – Tobacco taxes will continue to increase in line with inflation plus 2 percent for the remainder of this parliamentary term, and a further 10 percent increase will be applied to hand-rolling tobacco from October 30. The change added around 90p to the price of the average pack of cigarettes.

Increase in capital gains tax – Since October 30, the lower rate of capital gains tax has been increased from 10 percent to 18 percent, while the higher rate has increased from 20 percent to 24 percent. This tax applies to those selling off assets such as shares and second homes, and is only paid by around 350,000 people in the UK each year.

From November 2024

Changes to the right to purchase discount – Since November 21, reductions granted to HLM residents wishing to purchase their housing under the right to buy regime will be reduced. Currently the discount is 70 per cent of the market value, up to a maximum of £102,400, or £136,400 in London. This amount will now be reduced to £16,000, or £38,000 in London.

Exceptional tax increase – The Windfall Profits Tax, formerly known as the Energy Profits Levy, was introduced by the Conservative Government in May 2022 at a rate of 25 per cent. It was increased to 35 percent in 2023, and Reeves increased it further to 38 percent. Labor plans to use revenues from oil and gas giants to raise money for renewable energy projects, which they say will help reduce bills in the future.

From January 2025

VAT on private schools – From January 1, VAT will start to be charged on private tuition fees at the standard rate of 20 percent. This amount may be passed on to parents, partially or completely, in their tuition fees from the spring term. The government predicts the policy will raise £1.7 billion a year for the Treasury by 2030, which it plans to invest in state-funded schools.

Increase in the bus fare cap – From the start of next year, the capping of single bus fares, which applies to more than 5,000 routes in England, will increase from £2 to £3. Fares below the cap will rise with inflation, and the government said the higher cap would still save commuters up to 80 per cent on some longer journeys.

From February 2025

Reduction of customs duties – From February 1, duty on draft beer will be reduced by 1p, which the Treasury estimates will reduce overall duty bills for businesses by £85 million a year. It is up to individual pubs and restaurants whether these savings will be passed on to customers, as they will also face other cost increases, such as increased employer National Insurance contributions.

From April 2025

National living wage increase – The Chancellor announced a salary increase for more than three million workers from April 6, 2025increasing the national living wage by 6.7 percent. It will rise from £11.44 to £12.21 an hour from April 2025 – a pay rise worth £1,400 for an eligible full-time worker. The minimum wage for 18 to 20 year olds will also increase from £8.60 to £10 an hour.

Increase in childcare allowance – Child care allowance provides up to £81.90 per week to those who care for someone at least 35 hours a week. Currently you can only earn £151 a week to qualify for this payment, but this is being increased to £196 – the equivalent of 16 hours on the National Living Wage. This will come into effect on April 1, 2025.

Universal Credit changes – Benefits will be increased in line with inflation in April 2025, an increase of 1.7 percent. This will only mean a slight increase for most applicants. Universal Credit. At the same time, a crackdown on benefit fraud will be launched and the government will continue its project to reform the assessment of work capacity.

State pension changes – The Chancellor confirmed that state pension will increase by 4.1 per cent in April 2025. The new full state pension will rise to £230.30 a week – £11,975 a year – and the old basic state pension will rise to 176.45 £ per week – £9,175 per year.

National employer insurance – Currently, an employer must pay 13.8 percent national insurance on an employee’s salary beyond certain thresholds. From next April, this figure will increase to 15 percent. The threshold at which employers start paying national insurance contributions will also be reduced from £9,100 to £5,000. Employers have warned that this could lead to a reduction in salaries for some employees in the future.

Reduction of professional rates – Currently, hospitality, retail and leisure businesses can benefit from a 75 per cent reduction in spending. professional rates thanks to a reduction introduced during the pandemic, which was later extended and is due to expire on 31 March 2025. Instead, the Chancellor announced a further 40% relief for these businesses, up to a cap of £110,000 per business .

Capital gains tax on carried interest – From April 6, 2025, the capital gains tax on carried interest – a share of an investment’s profits paid to the investment manager – will increase from 28 percent to 32 percent.

From April 2026

Changes to inheritance tax for farmers – The Chancellor announced that the farm property relief allowed farmers to reduce, or even avoid altogether, the payment of inheritance tax on agricultural estates. From April 2026, only the first £1 million of a property’s value will be tax free, and beyond that there will be 50 per cent relief, at an effective rate of 20 per cent . Some fear the change will force farmers to sell their land to pay the tax.

Changes to air passenger rights – Air passenger taxes will be increased in line with inflation from April 2026, which the Chancellor said will add “no more than £2 for a short-haul economy class flight”.

From October 2026

New tax on vaping liquids – From 1 October 2026, a new flat rate duty will apply to vaping liquids, which will be charged at £2.20 per 10ml, increasing the cost of the fluid used in reusable vaping products. This will be offset by an equivalent increase in tobacco products “in order to maintain a financial incentive to choose vaping rather than smoking”.

From April 2027

Inheritance tax on pension funds – From April 6, 2027, inheritance tax will apply to unused pension funds and death benefits paid to beneficiaries following the death of a person. Under the current regime, in force since 2015, unused pension funds are exempt from inheritance tax.

Increase in obligations for private jet passengers – With air taxes on commercial flights expected to rise by just a few pounds, the Chancellor announced a 50% increase for private jet passengers, which she said equates to “£450 per passenger for a private jet to, say, California.” » – a jab at former Prime Minister Rishi Sunak.

From April 2028

Unfreezing of income tax brackets – Income tax thresholds have been frozen since 2021 and this freeze was due to expire in 2028. There had been speculation that the Chancellor would extend this freeze, but she confirmed that the brackets would start to rise with inflation from from April 2028, preventing some people from being dragged into high tax brackets.