Funds raised for the Great North Air Ambulance Service.

The favourable tax regime for Furnished Holiday Lettings (FHLs) was first introduced in 1984. Forty years later, in the Spring 2024 Budget the then Chancellor of the Exchequer, Jeremy Hunt announced its abolition from 6 April 2025.

The biggest revenue raiser in the Budget was the changes to NICs. The increase in Employers’ NICs (increasing from 13.8% to 15% from April 2025) grabbed many of the headlines. What has been largely overlooked is the reduction in “Secondary Threshold” from £9,100 to £5,000. Allied to the increase in the National Living Wage, the changes will particularly affect those in the care, retail, hospitality and cleaning/maintenance sectors.

It is difficult to recollect a more seismic Budget in recent times. The last major changes to Inheritance Tax were made in 2006, but mainly in relation to Trusts. There was an expectation that Inheritance Tax reliefs would be reformed, most likely for landlords who lease out land which qualifies for Agricultural Property Relief (APR). It was considered much less likely that Business Property Relief (BPR) would be reformed, and there was a distinct lack of speculation in this regard.

Wednesday 5 April 2025 sees the end of the current Tax Year. Following the new Chancellor's plans to continue to freeze
and in some cases reduce tax-free allowances; it is more important than ever to make the most of some timely tax planning.