Philip Hammond delivered his 2017 Autumn Budget announcement this afternoon; I think Old Mutual Wealth hit the nail on the head in an email I received from them earlier which started with this comment: "The Chancellor delivered his Budget speech today – his first Autumn Budget. An hour into the speech and we were waiting for the punchline. It never came."
That just about sums it up really; I was initially concerned that there might have been further unwelcomed changes to pensions; reduction in the annual allowances, removal of higher rate tax relief, or an attack on carry forward; but not so. In fact, pensions were left untouched aside from the expected increase in the lifetime allowance.
All in all, quite a low key budget speech, but here are the highlights I think you will be most interested in:
Personal allowance – 2018/19
The personal allowance is being increased to £11,850.
The threshold above which higher earners start paying higher rate tax of 40% is being increased to £46,350.
Individual Savings Account (ISA) subscription limits – 2018/19
This remains unchanged at £20,000; apart from Junior ISAs and Child Trust Funds which will be increased to £4,260 in line with CPI.
Pension Standard Lifetime Allowance – 2018/19
This is going to increase from £1,000,000 to £1,030,000 in line with the 3% annual consumer prices index (CPI) increase for Sep’17.
State pension increase
The basic state pension will be increased in April 2018 by 3% due to the triple lock; this equates to an increase in the full basic state pension of £3.65 per week.
This also affected the full ‘new’ state pension which will also be increased by £4.80 per week.
Inheritance tax (IHT)
HMRC has commissioned research into the behaviour and motivation behind an individual’s decision making process for IHT planning. He mentioned the results of a survey that focused on the use of reliefs and exemptions; this survey highlighted a limited understanding of IHT.
We think the results of this research may be an indication of an in depth review of IHT planning is to come.
Stamp duty land tax (SDLT) for first time buyers
With effect from the 22nd November 2017, first time buyers will pay no SDLT when buying a residential property less than £300k. On properties between £300k and £500k, they will pay SDLT at 5% on the amount in excess of £300,000.
Properties over £500k will not be entitled to any relief.
Stamp duty land tax (SDLT) for additional properties
Since April 2016, all those who purchase residential property when they already own at least one property, and are not replacing their main residence, have paid higher rates of SDLT (3% above the standard rates).
Relief from the higher rates will be introduced for certain cases, where a….
I hope you find this summary of interest.Back to articles