UK General Election 2024: What Labour’s win means for individuals and business owners

A new Labour prime minister has been voted in after two months of intense campaigning, amid a dire cost of living crisis, record-high interest rates and years of economic austerity. We touch upon policies the Labour Party are expected to implement which could impact individuals, limited company directors and business owners.

The Labour Party have achieved a landslide victory in the 2024 UK Elections, which will see the United Kingdom under Labour leadership after 14 years of Conservative rule.

The leader of the Labour Party, Kier Starmer, said that the time for change begins now as we enter an ‘age of national renewal’.

Labour’s fiscally focused manifesto sets out a plan to renew the financial health of the country and deliver economic stability. While this involves no major tax overhauls, the Labour Party have proposed ambitious plans to replace the business rates system, increase public sector tender opportunities for small businesses and crack down on late payments.

Here’s what Labour’s win means for individuals and business owners:

• Impose VAT on private schools which is expected to raise £1.5 million
• No planned changes to National Insurance Contributions (NIC), Income Tax and VAT
• Protect triple lock on pensions and increase yearly in line with inflation, average earnings, or 2.5%, whichever is higher
• Cap Corporation Tax at the current level of 25% for the entire Parliament
• Crackdown on performance-related pay in private equity being treated as Capital Gains. This could impact Business Asset Disposal Relief (BADR), formerly Entrepreneurs’ Relief, which is often part and parcel of a Members’ Voluntary Liquidation (MVL), a formal company liquidation procedure for solvent businesses
• Replace the existing business rates system with a new system to level the playing field between the high street and online giants. This measure aims to incentivise investment, tackle empty properties, and support entrepreneurship. While it’s expected to raise the same amount of revenue, it plans to implement a fairer framework
• Fairer chance for small businesses to win public contracts with guaranteed shortlisting for smaller firms for government tender contracts
• Crackdown on late payments to small businesses by imposing more stringent reporting requirements on large businesses to expose late payers. This measure is to tackle a ‘systematic poor payment culture’ fuelled by late payers