View more on these topics

Govt raises personal allowance and higher rate tax threshold

Tax-Taxation-Blocks-700.jpg

The Government has confirmed the tax-free personal allowance will increase to £12,500 by the end of the current parliament.

Announcing the Autumn Statement today, Chancellor Philip Hammond says the higher rate of income tax threshold will also move to £50,000 over the period.

Hammond says that once the £12,500 allowance has been introduced the personal allowance will automatically increase after 2020 in line with inflation rather than with the national minimum wage, which is currently planned.

He did not commit to further threshold changes after 2020, however, saying that “it will be for the Chancellor to decide what is affordable.”

In the March Budget, former Chancellor George Osborne raised the personal allowance to £11,500 from April 2017.

At the same time, the threshold at which employees pay the higher 40 per cent rate of income tax was moved from £42,385 to £45,000.

Recommended

Money-Cash-Coins-GBP-Pounds-UK-700x450.jpg
1

Personal allowance and higher tax rate threshold increased

The personal allowance and the threshold for the higher rate of income tax are both set to increase from next April. The Government has pledged to move the personal allowance to £12,500 by the end of this Parliament. It was already due to increase £11,000 next month, but Chancellor George Osborne says it will then […]

George-Osborne-with-head-down-walking-700.jpg

Govt eyes early increase to personal allowance

Chancellor George Osborne is considering a package of measures to lessen the impact of his controversial cuts to tax credits. A plan, including speeding up the planned increases in the personal allowances, could be unveiled in the Autumn Statement, the Mail on Sunday reports. Under current proposals, the Government will raise the starting rate of […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Leave a comment