There will be a change to income tax in the United Kingdom from the 6th of April 2017 and the first point of interest falls on the personal allowance. This is the amount of money you can earn each year before you have to start paying tax. Up until now, this figure has been set at £11,000 but as of the 6th of April, the figure rises to £11,500. £500 over the course of a year may not seem like a big deal to a lot of people but there will be many people who are positively impacted on this.
First of all, it will mean thousands of people in the United Kingdom do not have to pay any tax at all, which will hopefully help people to make more of their life. There is also a hope that more than 20 million will be able to save £100 a year. Again, there will be some people who say that in the grand scheme of things, £100 isn’t a lot but the best way to look at the situation is to ask yourself would you prefer to have £100 or would you rather give it to the Government? The vast majority of people would much prefer to have that cash in their own bank account or pocket so you can see why this is something that would be a lot more attractive for many people in the country.
Tax changes are on their way
There is also a slight change to the higher rate of tax. This is the rate where people pay 40% in taxes and the starting point moves to £45,000 when it used to be £43,000. This will save the people affected by this change £400 a year, and again, that is always going to be of benefit. This is a change that is not being implemented in Scotland, with the higher rate threshold being frozen at £43,000. With there being so many talking points about Scotland and England these days, it is not likely that this will add much fire to the debate but it is always something to bear in mind.
Another big change when it comes to money in the United Kingdom will be seen with the fact that people aged 25 or older and who are on the National Living Wage will see a rise in the money they receive. This change takes place on the 1st of April and there is a 4% rise on offer for these people, with the NLW rising from £7.20 an hour to £7.50 an hour.
This is good news for these people but younger people, who are aged between 21 and 24, will only receive a rise of 1.4% for their National Minimum Wage. This is a concern because this is a rise that is lower than the CPI inflation rate, which currently stands at 2.3%. Other levels that come into effect at this time of year are the National Minimum Wage for people aged between 18 and 20, with this figure standing at £5.60 an hour and for people under the age of 18, the National Minimum Wage will be pegged at £4.05 an hour. There is also the National Minimum Wage for apprentices and this will be set at £3.50 an hour.
Improve your savings
Another change that is coming into effect from the 6th of April is the Lifetime ISA, which is being dubbed Lisa. This Lisa is only open to people who are 40 years and under, and people over that age will not be allowed to open an account. This is a scheme that has been set up for people who are looking to buy property at some point in the future or who are starting to think about retirement income.
The benefit in this scheme comes from the fact that the Government will add a 25% bonus to the savings after a year, with the maximum boost being £1,000. Any time you can receive a helping hand when it comes to finances has to be seen as a positive thing, and this is definitely something that people should take an interest in. Being able to save for the future may sound very far off for a lot of people but if you don’t start to make changes that will help you in years to come, you may regret it.
That is why this sort of assistance is always going to be of benefit to people.
Andrew Reilly is a freelance writer with a focus on news stories and consumer interest articles. He has been writing professionally for 9 years but has been writing for as long as he can care to remember. When Andrew isn’t sat behind a laptop or researching a story, he will be found watching a gig or a game of football.