A VERY brief summary of budgetary announcements made last week, and also a reminder of those already made that will take effect from 6th April:
- income tax personal allowances remain unchanged for 2010/11
- the National Insurance Lower Earnings Limit will be increased from £95 to £97
- a reminder that for those with adjusted net income over £100,000, their personal allowance will be reduced by £1 for every £2 over the limit
- a new tax rate of 50% will be applied on those earnings over £150,000
- for dividend income, the new tax rates will be 10%, 32.5% and 42.5%
- the ISA limit will increase to £10,200 from 6th April 2010, of which a maximum of £5,100 may be invested to a cash account
- from 6th April 2011 the higher rate of tax relief on pension contributions will be restricted for those with gross income over £150,000. Anti-forestalling rules apply in the interim
- consideration is being made for removing the dafault retirement age of 65, although no changes will come into place before April 2011
- inheritance tax thresholds will remain frozen at £325,000 until the end of tax year 2014/15, scrapping previously announced increases to the threshold
- first time buyers will pay no stamp duty on properties worth less than £250,000
- stamp duty on properties over £1,000,000 will increase from 4% to 5%
- to encourage greater financial inclusion, more people are to be given access to setting up bank accounts
- legislation is being introduced to provide for larger penalties for taxpayers failing to provide a full account of their income and capital gains relating to offshore investments
- capital gains tax will remain at 18%, with the annual exemption being frozen at £10,100 for 2010/11
