29th October 2018
The Chancellor of the Exchequer, Philip Hammond, has today delivered this year’s Budget Report.
Paul Morton, Investment Planning Director, comments;
“Despite many rumours of further changes to pension allowances (lifetime and annual) and pension tax relief, the Budget was void of any material change.
From a personal financial perspective, the raising of the personal allowance and the higher rate tax threshold will provide a welcome reduction in the income tax burden for many.
Other allowances and reliefs have either been maintained or increased, as planned, in line with inflation.”
Please see our summary below;
Personal Allowance and higher rate threshold
The government will meet its commitment to raise the Personal Allowance to £12,500 from April 2019, one year earlier than planned.
The government will also increase the higher rate tax threshold to £50,000 from April 2019, also one year earlier than planned.
Lifetime allowance for pensions
The lifetime allowance for pension savings will increase in line with CPI for 2019-20, rising to £1,055,000.
Starting rate for savings
The band of savings income that is subject to the 0% starting rate will be kept at its current level of £5,000 for 2019-20.
Individual Savings Account (ISA) annual subscription limits
The adult ISA annual subscription limit for 2019-20 will remain unchanged at £20,000. The annual subscription limit for Junior ISAs for 2019-20 will be uprated in line with CPI to £4,368.
Child Trust Funds
The government will publish a consultation in 2019 on draft regulations for maturing Child Trust Fund accounts. The annual subscription limit for Child Trust
Funds for 2019-20 will be uprated in line with CPI to £4,368.
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