What Does the Autumn 2024 Budget Mean for UK Holiday Let Owners?

The Chancellor made her Autumn Budget announcement on the 30th October 2024. The measures below may be relevant to holiday let owners.

Sykes hosted a reactive and informational webinar with experts in the tax (Zeal Tax) and mortgage (B2B Finance) sectors, to discuss in further detail the impact that some of the Budget announcements could have on holiday let owners.

See below a clip from Zeal Tax that summarises the key updates regarding tax.

To enjoy full access to further information and guidance following announcements and changes such as these, sign up with Sykes today.

Business rates

• In England, for 2025-6, self-catering properties that (a) pay business rates and (b) don’t qualify for small business rates relief, will be entitled to a 40% discount on their business rates, capped at £110,000 per business.

• Small businesses will benefit from the multiplier that is used to calculate their business rates being kept permanently low from April 2026.

Read our full guide to holiday let business rates and council tax for more information.

Capital Gains Tax

• Capital Gains Tax (CGT) on property sales haven’t changed (it's 18% for lower rate payers and 24% for higher rate payers)

Read further information on Holiday Let Capital Gains Tax.

Inheritance Tax

• Despite fears of changes to the 7-year-gift rul,e and the generally applicable inheritance tax (IHT) rules, these will remain as they are.

• Currently, combined business and agricultural assets had full relief from IHT. From April 2026, the first £1m of combined business and agricultural assets will continue to attract no IHT but 50% IHT will apply to the value of the asset beyond £1m.

Stamp duty land tax surcharge increase

• In England, buying a second property (i.e. one that isn't your main home) previously attracted a stamp duty land tax surcharge of 3%. From 31 October 2024, it increased to 5%. The increase won't apply to transactions where exchange has taken place before 31 October 2024.

• This remains 4% in Wales and 6% in Scotland.

See our full guide to holiday let stamp duty.

Visitors

• Staycation numbers might increase given fuel duty has been frozen for another year and the 5p cut retained for another year, coupled with the slight increase to air passenger duty.

Employment Costs

From 6 April 2025:

• The rate of employer national insurance contributions has been increased from 13.8% to 15%.

• The per-employee threshold at which employers start to pay national insurance will be reduced from £9,100 per year to £5,000 per year.

• To support small businesses with these changes, the government is increasing the Employment Allowance from £5,000 to £10,500 and removing the £100,000 eligibility threshold for Employment Allowance.

• The minimum wage for those over 21 will be increased from £11.44 to £12.21.

• The minimum wage for 18-20 year olds will be increased to £10 to close the gap and to eventually have a single minimum wage for all over 18s.

Disclaimer

Sykes can’t advise you on, and isn’t responsible for, tax matters in relation to your holiday let and the above should not be taken as such, rather as a prompt of the issues involved for further consideration. As always, please read the relevant laws, regulations and guidance and seek advice from external experts where you require it. Sykes hopes that by pointing you in the direction of an expert in the field, it’s starting you off on the right foot, and you can read into this matter further and seek your own advice from Zeal, or your chosen advisor, as and when you feel it’s needed. We cannot make any representations or warranties of any kind as to the competency, qualification, fitness for purpose, accuracy, reliability, suitability, or availability of Zeal’s offers, products or services. If you choose to enter into any arrangement for the supply of goods or services of a supplier listed in this newsletter or links, you do so entirely at your own risk. Any such arrangement is between you and the supplier. We are not a party to it. We shall not be liable for any loss or damage arising under or in connection with any such arrangement or any action or decisions you take or do not take as a result of reading the above or any loss suffered as a result.