New Income Tax Year 6 April 2012

05 - 04 - 2012

Tax and benefit changes for the new income tax year come into effect from 6 April 2012

Several tax and benefit changes announced in the Budget and over the last 18 months take effect this month.
Already a client of Foremans LLP? You'll receive our Advice Note on tax changes that may affect your business. 
Looking for a more general overview? The main changes are summarised below:

Income Tax Personal Allowance
On 6 April the personal allowance rises by £630 to £8,105 for under-65s.

The upper threshold of the basic rate falls by £630 to £34,370.
If you are aged between 65 and 74, the personal allowance rises from £9,940 to £10,500. If you are 75 or over it rises from £10,090 to £10,660. This extra amount will be gradually withdrawn from those with a taxable income between £24,000 and £29,000.
There is a gradual withdrawal of the personal allowance for everyone with income over £100,000, regardless of age.

National Insurance
The weekly earnings limit (primary threshold) for employees National Insurance Contributions (NICs) at 12% increases from £139 to £146.
The lower earnings limit for primary Class 1 NICs increases from £102 to £107.
The secondary threshold rises from £136 to £144.

Statutory Pay
The standard rate of statutory maternity, paternity and adoption pay is going up from £128.73 to £135.45 per week.
Statutory Sick Pay (SSP) rises from £81.60 to £85.85 per week.

From 9 April the full basic state pension will rise by £5.30 to £107.45.

The Individual Savings Account (ISA) allowance rises to £11,280.
Up to £5,640 of this can be saved in cash with one Isa provider. The remainder can be invested in stocks and shares with either the same or a different ISA provider.

Child Tax Credits
The child element of child tax credits, which is paid to support lower income families, rises by £135 on 6 April.
There is no change to the couple and lone-parent elements of working tax credit.

Inheritance Tax
The first £325,000 of inheritance when somebody dies remains exempt from inheritance tax. However the rate of inheritance tax for amounts over £325,000 will be cut from 40% to 36% for estates that leave 10% or more to charity.

For additional information on the main changes from the Budget 2012
click here.
Want help and advice on tax? Why not give us a call on 01244 625 500 or click here to contact us.






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