As expected with Brexit looming, Philip Hammond delivered a fairly boring and nondescript Budget yesterday, with only one or two small surprises. The highlights of the changes most relevant to our day to day Financial Planning are highlighted below.
Pensions
- The lifetime allowance for pension savings will increase in line with CPI, rising to £1,030,000 for 2018/19.
- The State pension will increase by 3% (CPI rate for September) in April 2018.
- The standard minimum guarantee in the pension credit increases by a similar amount.
- There are no changes to the annual allowance, tapered annual allowance or money purchase annual allowance.
Stamp duty land tax
- Stamp duty has been abolished on homes under £300,000 for first-time buyers and they will not pay stamp duty on the first £300,000 for homes worth between £300,000 and £500,000.
Income tax and National Insurance
- The personal allowance will increase to £11,850 for 2018/19.
- The higher rate threshold will increase to £46,350 for 2018/19.
- The band of savings income that is subject to the 0% starting rate will be kept at its current level of £5,000 for 2018/19.
Capital Gains Tax
- The annual allowance will increase to £11,700 from April 2018.
Inheritance Tax
- There were no changes announced for Inheritance Tax.
Investments
- The Individual Savings Account (ISA) annual subscription limit for 2018/19 will remain unchanged at £20,000.
- The annual subscription limit for Junior ISAs and Child Trust Funds for 2018/19 will be uprated in line with CPI to £4,260.
If you have any concerns or questions, please do get in touch.