We’re now in the new tax year with a bigger than usual set of changes.  Here’s our list of the main headlines:

Income Tax:

• £11,850 is the starting point for paying 20% basic tax rate (up from £11,500)
• 40% tax will start on earnings above £46,350 (up from £45,000)
• Above the £150k upper rate, you will pay 45%.

Dividend Taxes:

• Everyone now receives a £2,000 allowance, down from £5,000.
• Once past the allowance, basic rate taxpayers will pay 7.5% tax, higher rate taxpayers will pay 32.5% and additional rate taxpayers will pay 38.1% tax.
• These changes don’t affect any shares you hold in an Isa or a pension.

Capital Gains Taxes:

• Lower rate taxpayers pay 10% tax; higher and additional rate taxpayers pay 20%
• If you’re selling a second property, including buy-to-let investments, then you are the exception and there will be charge of 18% for basic rate taxpayers or 28% for higher and additional rate taxpayers.

Pensions:

• There are no major changes to pension allowance.
• The lifetime pensions allowance has been increased by £30,000 and now stands at £1,030,000.

Isas:

• If you have a Help to Buy Isa you can save up to £3,400 in the first year and then £2,400 each year after
• If you have a Lifetime Isa you can save £4,000 a year and this can be used towards the cost of buying a first home or for retirement.

Now is a great time to review your financial plans and make sure they are working for you.  Please get in touch with to arrange a free review meeting.  Call 0114 235 3500.