What are the main changes to the UK’s budget for 2014-15 and how will they affect you?
Personal pension restrictions ended – There is now no need to buy an annuity
The result of five years of quantitative easing has been a long time coming. The draconian requirement to buy an annuity with your hard-earned pension pot is over, allowing savers to do pretty much what they like with their money. No need to settle for astoundingly low annuity rates.
New Pensioner Bond available paying up to 4% interest – As part of the Budget, George Osborne, the Chancellor, announced National Savings and Investments will offer new Pensioner Bonds from January 2015. The rates will be set in the autumn, but Mr. Osborne said he expects the one-year bond will pay around 2.8pc and the three-year bond will pay around 4pc.
Threshold for 40p income tax raised by 1% to 41,865 GBP – The Institute for Fiscal Studies (IFS) has said previously that, compared with the state of play when the coalition government took office four years ago, the higher rate threshold has dropped by £4,910, creating an extra 1.1 million higher rate taxpayers.
No fuel tax rise / tobacco up 2% above inflation – Chancellor George Osborne announced that the planned September fuel duty rise will not take place, but he resisted calls to cut duty – to the disappointment of campaign and motoring groups.
Inheritance tax is waived for 999 workers killed on duty – In a gesture to honour every frontline sacrifice, the Chancellor wants to free the estates of fallen or mortally injured police officers, fire fighters and ambulance crews from any duty.
Beer duty cut by 1p a pint. Duty on spirits and cider are frozen – George Osborne cut duty on every pint of beer by 1p, froze tax on cider and spirits and scrapped plans to increase duty on wine above the rate of inflation.
Cap on Premium Bond holdings up to 50,000 GBP – The Chancellor announced a £10,000 increase in June of the maximum value of Premium Bond holdings, from £30,000 to £40,000. That cap will rise again to £50,000 next year. He also introduced a second £1 million monthly jackpot.
The point at which individuals start to pay income tax raised to 10,500 GBP – As expected, George Osborne raised the personal tax allowance to £10,500 with the increase to come in the weeks before next May’s general election
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