Short Name have a wealth of experience in advising businesses and individuals in the Cardiff area on a range of key tax and financial planning issues. Here we consider strategies to help you to minimise your tax bill, maximise your profitability and boost your wealth.
Fiscal statements
Several significant tax changes were announced in the Spring and Autumn Budgets 2024.
Personal tax
The UK-wide personal allowance was frozen at £12,570 from 6 April 2021. The basic rate band threshold has also been frozen at £37,700. The personal allowance and thresholds are expected to remain at these levels until April 2028.
There have been no changes to the rates of taxation on non-savings and savings income. The rates of taxation on dividend income for 2025/26 will remain at 8.75% (basic rate), 33.75% (higher rate) and 39.35% (additional rate). The Dividend Allowance was been reduced to £500 for 2024/25 and will remain so for 2025/26. The Savings Allowance remains at £1,000 for basic rate taxpayers and £500 for higher rate taxpayers (no Savings Allowance is available for additional rate taxpayers).
Scottish taxpayers: income tax rates and bands for non-savings and non-dividend income are different from the rest of the UK. For 2025/26 the rates remain as they were for 2024/25, with six income tax rates which range between 19% and 48%. Scottish taxpayers are entitled to the same personal allowances as individuals in the rest of the UK and the rates on savings and dividend income are as for the rest of the UK.
Other personal tax changes
The Furnished Holiday Lettings (FHL) tax regime, which gives certain tax benefits to individuals letting a property as a short term holiday rental, is abolished from 6 April 2025.
National Insurance contributions
The main rate of Class 1 employer National Insurance Contributions (NICs) was increased from 5 April 2025 to 15% and theemployer’s secondary threshold reduced to £5,0000 per annum.
The thresholds for employees Class 1 NICs and also Class 4 NICs remain at 2024/25 levels.
Corporation tax
The main rate of corporation tax for a standalone company remains 25% where profits for an accounting period exceed £250,000. If a company has no associated company in the accounting period and its profits do not exceed £50,000, the small profits rate will be 19%. If a company has no associated company in the accounting period and its profits are between £50,001 and £250,000, marginal relief will apply.
If a company has one or more associated companies in the accounting period then the limits are divided by the number of associated companies plus one. For an accounting period of less than 12 months the lower limit and the upper limit are proportionately reduced. There are a number of complex rules regarding associated companies.
Your financial planning strategy
It is more important than ever to have a robust business and personal financial planning strategy in place, to help ensure that you and your family are financially secure and on course to achieve your long-term goals.
If you're in the Cardiff area and would like advice on tax planning strategies, please contact Short Name.