October Budget Key Points

Fri 2nd Nov, 2018 - 2:30 pm - 0 Comments

This week we summarize the key points from the budget for you.

Housing

The sale of the family home is usually exempt from Capital Gains Tax.

The Budget reduced the period that continues to qualify for relief once the owner has moved out from 18 to nine months.

In a boost for first-time buyers Mr. Hammond agreed to extend the stamp duty exemption to shared ownership properties worth up to £500,000.

Wages and personal tax

From April 2019 the National Living Wage will increase from £7.83 an hour to £8.21.

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 increase comes a year earlier than planned, and will be maintained in 2020.

The higher rate threshold will increase from £46,350 to £50,000 in April 2019

Investments

The government will increase the annual investment allowance five-fold from £200,000 to £1m to help businesses to invest and grow. This will be with effect from 1st January 2019.

The minimum investment for Premium Bonds will be reduced from £100 to £25 and people other than parents and grandparents will be able to purchase Premium Bonds for children under 16.

Pensions and self-employed

Self-employed workers will see their tax bills increase from 2020 onwards as the government has expanded the off-payroll working rules, known as IR35, to the private sector.

The move will force contractors such as IT and management consultants who work through their own company but are in practice employed by a third party, pay the right tax as employees.

The government also unveiled responses to their proposals for a pension cold-calling ban.

 

*All data taken from FT Adviser

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