Monday, 29 October 2018 17:13

Budget 2018: Summary of changes

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Budget 2018 Budget 2018

The Treasury has released a list of must-know changes from Chancellor Phillip Hammond’s Budget his afternoon.

Highlights included:

• Employment is at a near record high and the OBR forecasts it is set to keep growing.The economy has grown every year since 2010, and is projected to continue growing in each year of the forecast. The unemployment rate is at its lowest for over 40 years, there are over 3.3 million more people in work since 2010 and the OBR forecasts 800,000 more jobs by 2022.

• National Living Wage will increase to £8.21From April 2019 the National Living Wage will increase from £7.83 an hour to £8.21. This will benefit around 2.4 million workers, and is a £690 annual pay rise for a full-time worker.

 

• The tax-free Personal Allowance will rise to £12,500 The Personal Allowance – the amount you earn before you have to start paying income tax– will increase by a further £650 in April 2019 to £12,500. This rise comes a year earlier than planned, and will be maintained in 2020.This means a basic rate taxpayer will pay £1,205 less tax in 2019-20 than in 2010-11.

• The Higher Rate Threshold will increase from £46,350 to £50,000 in April 2019. The amount people will have to earn before they pay tax at 40% will increase from £46,350 to £50,000 in April 2019. This means that in 2019-20, there will be nearly 1 million fewer higher rate taxpayers than in 2015-16.

• Fuel duty will remain frozen for a ninth year. In 2019, fuel duty will remain frozen for the ninth year in a row, saving the average driver £1,000 since 2010.

• The Annual Investment Allowance will increase to £1 million from 1 January 2019 to 31 December 2020 The government will increase the Annual Investment Allowance five-fold from £200,000 to £1 million to help businesses to invest and grow.

• A 2% digital services tax on large digital firms. From April 2020, large social media platforms, search engines and online marketplaces will pay a 2% tax on the revenues they earn which are linked to UK users.

Concluding his Budget speech, Mr Hammond said: “The hard work of the British people is paying off in hard cash in their pockets.”

 

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