March 21, 2012

Impact of the Budget 2012 for individuals

INCOME TAX - From April 2013, the 50p top rate of tax will be cut to 45p

PERSONAL INCOME TAX ALLOWANCE – Raised to £9,205 from April 2013

PENSIONS - Age-related allowances to be removed for new pensioners from April 2013 to be replaced with a single personal allowance. Allowances for those of pension age to be frozen. Automatic review of state pension age so that it keeps pace with increasing lifespans. New single-tier state pension for future pensioners to be set at about £140 and based on contributions. No significant change to pensions relief.

CHILD BENEFIT - Phased out when a household has one person earning more than £50,000. It will fall by 1% for every £100 earned over £50,000. Those earning more than £60,000 will lose the entirety of the benefit.

STAMP DUTY – Immediate new stamp duty level of 7% on residential property purchases of more than £2m. Any such homes bought through companies will pay 15%. And don’t forget - on 24 March, 1% stamp duty tax will return on transactions between £125k to £250k

AVOIDANCE - New general anti-tax avoidance rule to be introduced. We will keep an eye on this!

ARMED FORCES – There were a number of announcements relating to financial support for families of the Armed Forces

There are other blogs addressing the issues for businesses

BBC News Budget Special Coverage

For further details on any of the issues covered in this update please contact Deanna Hurst, Partner in Private Client on 020 7583 2222 or email [email protected]

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