Autumn Statement 2012

Autumn Statement 2012

December 5th 2012 3:04 pm

general

Well the 2012 Autumn Statement has now been given and we will do a quick shortlist of the important changes for personal tax, ...

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Well the 2012 Autumn Statement has now been given and we will do a quick shortlist of the important changes for personal tax, business and benefits.

Changes which will affect individual pockets

  • People born after 5th April 1948 (Under 65) will have a higher than previous announced tax free personal allowance. The chancellor has announced an increase of £1,335 from the current (2012) allowance of £8,105. From April 6th 2013, the tax free allowance will be £9,440.
  • The higher rate threshold actually falls from £32,245 to £32,010 - a cut of £235 - but this is countered by the £235 lift in the personal allowance. From April 6th 2013, people under 65 can earn £41,450 before going into higher rate tax.
  • The chancellor is committed to increasing the higher rate threshold by 1% in 2014 and into 2015, £41,865 and £42,285 respectively.
  • Fuel duty escalator cancelled, so no 3 pence rise in fuel duty in January 2013.
  • ISA savings limit will be raised to £11,520 from the current £11,280. Increase of £240.
  • Inheritance tax threshold rising below inflation, 1%, next year.
  • Working benefits to rise 1% over next three years.
  • Basic state pension rising to £110.15 per week from 2013 - a 2.5% rise.
  • Child benefit to rise by 1% from two years from next April.
  • Housing benefit rises to be capped at 1% for two years from 2014.
  • Pension relief on lifetime contributions to drop to £1.25 million from 2014.
  • Pension tax relief capped at £40,000 - a drop of £10,000 from previously announced .
  • No mansion tax announced - nor changes to stamp duties.
The tax calculators at www.uktaxcalculators.co.uk have been updated from all tax changes announced in the autumn statement so head over there to see how these affect you for 2013.

Business

  • Corporation tax main rate to be cut to 21% from April 2014 - this is already dropping to 23% from April 2013.
  • No information yet on marginal rate or small companies rate.
  • Unemployment should peak at 8.3% - this is a 0.4% lower prediction than previously announced (8.7%).
  • Growth in 2013 to be 1.2%, 2% in 2014, 2.3% in 2015, 2.7% in 2016 and reaching 2.8% in 2017.
  • Growth negatively downgraded for this year. 2012 now predicted to be minus 0.1 percent - a 0.8 percent drop from past predictions.
  • The Government is committed to decreasing unemployment for each year they are in parliament.
  • Investment to be made in road, A1, A30, and M25 at a cost of £1 Billion.
  • Northern Line is being extended to Battersea at a cost of £1 Billion.
  • Ultra fast broadband planned for 12 cities, £600 Billion for Scientific research, total yearly infrastructure budget rises to £33 Billion.
  • Business bank gets £1 billion capital injection.
Overall no net rises in taxes, lower than expected growth - as speculated, unemployment high but falling, more money to build/improve schools and colleges, overseas aid to be curbed.  

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