Today Rishi Sunak shared the first budget since December’s General Election and his first since taking over as Chancellor from Sajid Javid in February. With the opening of the budget focused on the Coronavirus, we look at the other main points that may impact your finances:
- Pensions tax breaks for higher earners are to be made more generous from April. The income threshold at which tax relief on pension contributions starts to shrink will rise from £110,000 to £200,000.
- The bank base rate has been cut from 0.75 per cent to 0.25 per cent, reducing borrowing costs to the lowest level in history. This will reduce mortgage repayments for homeowners on tracker and variable-rate mortgages. Fixed rate mortgage repayments will remain the same. Overdraft and credit card lending rates are also set to remain the same.
- The national insurance threshold will be raised from £8,632 to £9,500 from next month.
- The lifetime limit on entrepreneur relief will be reduced from £10m to £1m.
- Annual capital gains tax allowance for individuals will rise from £12,000 to £12,300 in 2020-21. The exemption for trustees will be £6,150.
- The amount that families can save into a Junior Isa or child trust fund will more than double in 2020-21, from £4,368 to £9,000.
For more information on todays budget, please visit https://www.gov.uk/government/collections/budget-2020-tax-related-documents
Whenever changes are announced, it can be a good time to review your financial situation. If you’d like to speak with one of our advisers about what this budget might mean for you, please call us on 0114 235 3500.