The Budget 2018
Phillip Hammond’s delivery of yesterday’s budget promises to see the end of austerity and a cut in business rates for retailers. Here is a list of the key points in how you could be affected.
Personal Taxation and Wage
- The personal allowance will rise from £11,850 to £12,500 in April 2019. The personal allowance is the rate at which an individual starts to pay tax at 20%.
- The higher rate threshold will rise from £46,350 to £50,000. This is the level at which 40% of tax is payable from April 2019.
- From April 2020, the personal allowance and higher rate threshold will rise in line with inflation.
- The National Living Wage is set to increase from £7.83 to £8.21 an hour, starting April 2019.
Savings and ISA’s
The annual limit for Individual Savings Accounts (ISA’s) with stay unchanged at the level of £20,000, whilst the Junior ISA limit is to be increased from £4,260 to £4,368 from April 2019. For the Junior ISA to apply, your child must be under 18 and living in the UK.
Gift Aid at 25% on card and cash payments will be able to be claimed by Charities on individual transactions up £30. Previously the limit was £20.
The framework for implementing IR35 changes in the private sector will not introduced until April 2020. At that point the changes mean the taxation status for contractors will be decided by the large companies they work for, such as banks, with the firm using the contractor to pay 12% in NI. The change in rules does not apply for the 1.5 million smaller companies in England. Read more here.
Technology and Digital
A digital services tax of 2% is to be introduced for large UK tech companies with global revenues over £500 million from April 2020.
Millennial travellers aged 26 to 30 to be given 33% off the cost of rail travel across the network by April 2019.
Thirty million pounds has been allocated to repair motorways and potholes in the UK’s roads.
Lettings relief is to be limited to nine months from April 2019 in properties where the tenant is in shared occupancy with the owner.
Stamp duty exemption to apply up to £500,000 for first-time buyers purchasing shared equity homes.
In addition, the ‘Help to Buy’ equity loan scheme has been extended for two years from April 2021. The scheme helps first time buyers take steps in owning their first home through shared the ownership, equity loan and savings bonus scheme. The government will give a maximum bonus of £3,000 to help boost ISA savings towards the deposit on a property.
A cut to business rates of up to 33% over two years is set to be applied to businesses with a rateable value of £51,000 or less to help curtail the ‘retail apocalypse’ on the highstreets.
A plastic tax on packaging which does not contain 30% recyclable material is to be applied from April 2019, however the coffee-cup tax has been put on hold to be reconsidered if the industry does not make progress.
Sixty million pounds has been allocated to plant trees in England with ten million allocated to deal with waste sites