Finance Bill 2023-24 passes third reading

The House of Commons agreed the third reading of the Finance Bill 2023-24 on division on 5 February 2024, by 283 votes to 39¹. The Bill had returned to the floor of the House that day for its Report Stage and third reading¹. It received Royal Assent on 22 February 2024 and became the Finance Act 2024¹.

The Bill implements measures announced in the Autumn Statement, which Chancellor Jeremy Hunt presented to the House on 22 November 2023¹. Among them were a cut in the main rate of National Insurance contributions paid by employees (primary Class 1 NICs) and the main rate paid by the self-employed (Class 4 NICs)¹. The Government introduced 37 ways and means resolutions covering the measures to be included in the Bill; the House did not divide on any of them when it voted at the end of the debate on 27 November 2023¹.

Two measures drew most interest. The first is the abolition of the pensions lifetime allowance, on which HMRC published a tax information and impact note explaining the policy from 6 April 2024¹. The second is the announcement that capital allowance full expensing would be made permanent¹.

The Bill's earlier stages were also decided on division. Its second reading took place on 13 December 2023 and was agreed to by 291 ayes to 54 noes, after Drew Hendry's amendment to decline a second reading was negatived by 46 ayes to 296 noes¹. The Committee of the Whole House stage took place on 10 January 2024 and the Public Bill Committee stage on 16 January 2024; the Bill finished the Public Bill Committee stage without amendment¹.

Why it matters for households

The National Insurance changes affect employees and the self-employed through the rates deducted from pay and profits, and the pensions lifetime allowance change takes effect from 6 April 2024 according to HMRC's impact note¹. The full expensing measure concerns capital allowances claimed by companies rather than household finances directly¹. The Bill's remaining Commons stages were completed on 5 February 2024, and Royal Assent followed on 22 February 2024, so the measures it contains now sit in the Finance Act 2024¹. The briefing does not set out the percentage rates of the NICs cuts or their effective dates beyond those given above; those figures are not reported in this document¹.

What happens next

The Bill received Royal Assent on 22 February 2024 and became the Finance Act 2024¹. The abolition of the pensions lifetime allowance applies from 6 April 2024 under HMRC's published impact note¹. No further Commons stages are listed after third reading¹.

More on how tax and regulatory changes are made is in the regulation and policy section.