The 2024-25 UK tax year was lived through the shadow of two Budgets and a general election. The Spring Budget of 6 March 2024 confirmed the NIC cut to 8% and the VAT threshold uplift to £90,000. The general election of 4 July 2024 produced the first Labour government in fourteen years. The Autumn Budget of 30 October 2024 reordered planning priorities across the SME and family business landscape. By the time the tax year closed on 5 April 2025, the year had become best understood as the last full tax year before a series of substantial structural changes took effect from April 2025 and April 2026.
The pre-reform planning window
The five months between the 30 October 2024 Budget and the 5 April 2025 tax year end produced one of the most intensive planning windows we have worked through. Several measures announced in late October were due to take effect from 6 April 2025 — most notably the employer NIC increase to 15% with the £5,000 secondary threshold, the BADR rate rise from 10% to 14%, and the abolition of the non-dom remittance basis.
For BADR-qualifying disposals, the window from 30 October 2024 to 5 April 2025 was the last opportunity to crystallise gains at the 10% rate. We supported several share-sale and goodwill-disposal completions through January, February, and March 2025. The discipline of confirming qualifying conditions — two-year ownership, 5% shareholding, officer or employee status throughout — became the dominant theme of our tax planning engagements in those months.
Employer NIC — the last quarter of the old regime
Through 2024-25, employer NIC ran at 13.8% with a £9,100 secondary threshold. Conversations about the April 2025 transition began the week after the Budget. For employers with sub-£10,500 Employment Allowance eligibility, the impact of the 15% rate and the £5,000 threshold could be largely absorbed because the Employment Allowance uplift more than offset the rate rise. For employers above £10,500 of allowable Employment Allowance use, the rate rise and threshold drop produced real cash-cost increases that had to be managed through pricing, headcount, or hours.
Our payroll team built employer cost models for every affected client during the winter and ran scenario reviews into the spring. Several clients restructured working patterns to spread employer NIC liabilities more efficiently.
The first year of the £90,000 VAT threshold
The VAT registration threshold uplift to £90,000 from 1 April 2024 had been in operation for a full tax year by April 2025. For B2C service businesses sitting just under the line, the wider threshold extended the planning runway. For B2B service businesses with VAT-registered customer bases, the threshold made little difference to behaviour. Our VAT team ran deregistration assessments for several clients whose trailing twelve-month turnover had fallen between the 2024 and 2025 deregistration thresholds.
NIC at 8% in practice
2024-25 was the first full tax year with the main rate of Class 1 employee NIC at 8% and Class 4 self-employed NIC at 6%. For employees and the self-employed, the cumulative impact of the 2023-24 and 2024-25 cuts was the largest NIC reduction in a generation. The cash impact for higher earners was offset by the personal allowance and higher rate threshold freezes, but the net effect for most working-age earners was a modest take-home increase year-on-year.
For director-shareholders, the optimum salary calculation continued to shift fractionally upward and our 2025-26 director remuneration models — built in March 2025 — produced different optimum salary points than the 2023-24 equivalents.
Family business planning under the BPR cap
The October 2024 announcement that BPR and APR would be capped at £1 million from 6 April 2026 produced an immediate wave of family business inheritance tax planning. The seven-year potentially exempt transfer rule meant that lifetime gifts made in 2024-25 would still be inside the seven-year cumulation period at the 2026 effective date — so direct lifetime gifting was an incomplete answer. Family investment company structures, share class restructures, employee ownership trusts, and lifetime trusts all returned to the conversation.
Several family business clients triggered structural reviews during the year. The reviews are continuing through 2025-26 and into 2026-27.
The Furnished Holiday Let final year
The Furnished Holiday Let regime was in its final year of operation, abolished from 6 April 2025. Clients with FHL portfolios used the year to crystallise capital allowance positions, plan disposals against the favourable CGT treatment that was about to disappear, and restructure ownership where appropriate.
The non-dom final year
2024-25 was the last year of the resident non-domiciled remittance basis regime. For our Canary Wharf and Dubai client base with relevant non-dom status, the year was spent finalising the analysis of whether to claim the remittance basis one final time or to begin transitioning. The Temporary Repatriation Facility from 6 April 2025 provided a planned route for pre-April 2025 foreign income and gains to be brought to the UK at a 12% rate over the transition window.
The verdict
The 2024-25 tax year was bookended by political events that reshaped every conversation. The first half was framed by the pre-election Budget of 6 March and the campaign that followed. The second half was framed by Labour's first Budget of 30 October. For owner-managed businesses, the year ended as the last full tax year before a series of substantial structural changes that would take effect from April 2025 and April 2026 onward. The clients who used the planning window most effectively were those who completed BADR disposals before April 2025, who began the BPR planning conversation immediately, and who modelled employer NIC transitions before the new rates took effect.
If you have not yet reviewed your post-2024 position, contact our team and we will produce a structured retrospective.