The 2024/2025 tax year started on the 6 April 2024 and with it brings an increase to a number of benefits, allowances and other tax related thresholds.
Everyone works to a financial budget and understanding what has changed can help you plan for the new tax year.
The tax free personal allowance for individuals has been kept the same for the 24/25 tax year with it being maintained at £12,570 and keeping the standard PAYE tax code at 1257L for the forseeable future.
Some income tax rates and allowances were also updated following the Spring budget on March 6 2024.
Universal credit 2024/2025 tax year
A number of universal credit rates have been changed from April 6 2024.
Universal credit standard allowance:
- You’re single and under 25 £311.68 up from £292.10.
- You’re single and 25 or over £393.45 up from £368.74.
- You’re in a couple and are both under 25 £489.23 up from £458.51.
- You’re in a couple and one or both of you are 25 or over £617.60 up from £578.82.
Earning support allowance (ESA) 2024/2025 tax year
ESA rates are rising from April 2024 by 6.7% in line with CPI inflation.
ESA personal allowances:
- Single under 25: £71.70 up from £67.20.
- Single, 25 or over: £90.50 up from £84.80.
- Lone parent, under 18: £71.70 up from £67.20.
- Lone parent, over 18: £90.50 up from £84.80.
ESA couple:
- Both under 18: £71.70 up from 67.20.
- Both under 18 with child: £108.30 up from £101.50.
- Both under 18 (main phase): £90.50 up from £84.80.
- Both under 18 with child (main phase): £142.30 up from £133.30.
- Both over 18: £142.25 up from £133.30.
ESA disability:
- Enhanced disability, single: £20.85 up from £19.55.
- Enhanced disability, couple: £29.75 up from £27.90.
- Severe disability.
- Severe disability, single: £81.50 up from £76.40.
- Severe disability, couple (lower rate): £81.50 up from £76.40.
- Severe disability, couple (higher rate): £163 up from £152.80.
- Carer: £45.60 up from £42.75.
ESA pensioner:
- Pensioner, single with work-related activity component: £91.70 up from £82.55.
- Pensioner, single with support component: £79.95 up from £71.55.
- Pensioner, single with no component: £127.65 up from £116.25.
- Pensioner, couple with work-related activity component: £154.75 up from £139.85.
- Pensioner, couple with support component: £143 up from £128.85.
- Pensioner, couple with no component: £190.70 up from £173.55.
Components
- Work related activity: £35.95 up from £33.70.
- Support group: £47.70 up from £44.70.
Attendance allowance 2024/ 2025 tax year
- higher rate from £101.75 up from £108.55.
- lower rate from £68.10 up from £72.65.
Carers allowance 2024/2025 tax year
The carers allowance has been fixed at £81.90 up from £76.75.
Disability Living Allowance 2024/2025 tax year
Care Component:
- Highest £108.55 up from £101.75.
- Middle £72.65 up from £68.10.
- Lowest £28.70 up from £26.90.
Mobility Component:
- Higher £75.75 up from £71.00.
- Lower £28.70 up from £26.90.
Child benefit 2024/2025 tax year
The child benefit high income child benefit tax charge (HICBTC) threshold has been adjusted to £60,000 from the previous £50,000.
This will mean more people will be able to receive the full child benefit and less will have to pay some of the child benefit back via the high income child benefit tax charge.
As an added bonus this could mean less parents need to complete a self assessment tax return just to pay back the HICB charge.
Statutory maternity pay (SMP) 2024/2025 tax year
- Statutory maternity pay (SMP) from April 2024 is going to be £184.03 per week which is up from £172.48.
- Statutory shared parental pay and statutory adoption pay (SAP) rates have been kept the same as SMP at £184.03 per week.
- The maternity allowance has also gone up to £184.03 weekly rate.
Statutory paternity pay (SPP) 2024/2025 tax year
Statutory paternity pay (SPP) is set at £184.03 per week up from the 23/24 tax years £172.48 P/W.
Pension credits 2024/2025 tax year
The government has stated that there will be an 8.5% increase in the standard minimum guarantee for pension credit in the tax year of 2024/2025.
For individuals the pension credit will have a worth of £218.15 per week, as opposed to the previous amount of £201.05 in the tax year 2023/24.
Joint pension credit claims for both individuals will total £332.95 which is an increase from £306.85.
Savings credit 2024/2025 tax year
Part of the pension credit system the savings credit rate for individuals is now £17.01 per week and £19.04 for couples.
National insurance reduction 24/25 tax year
The main rate of class 1 national insurance is lowered from 6 April 2024 to 8% resulting in increased take home pay for millions of employees. This is a decrease of class 1 NIC’s of two percentage points and could affect around twenty nine million workers.
For self employed people there has also been a decrease in the primary rate of self employed class 4 NIC’s from 8% to 6% impacting approximately two million self employed individuals.
A copy of the governments full benefits and pension rates for the 24-25 tax year can be found here.
