The advent of the 2018/2019 financial year will usher in many changes in the taxation system. Are you prepared?
1. Income tax personal allowance is increasing
The personal allowance is increasing to £11,850, up from the current £11,500. In addition the threshold for higher-rate taxpayers will increase from £45,000 to £46,350.
2. Marriage allowance can be back-dated
The marriage allowance can now be backdated for four years of backdated claims for payments that had been missed.
3. Dividend tax allowance is being reduced
The tax free dividend allowance is set to be reduced from £5,000 to £2,000. Those that will be affected by this change are estimated to lose an average of approximately £315 a year.
4. Mortgage interest tax relief being phased out
From the 6th of April 2018 only 50% of mortgage interest will be able to offset against profits.
5. Pensions lifetime allowance is on the up
The standard lifetime allowance limit will rise from £1 Million to £1.03 Million.
6. Council tax may see the biggest rise
The 2% cap on council tax will be abolished, meaning some councils in London could increase the tax by as much as 5.99%.
7. Tax-free gains for inheritance tax
The nil-rate band will increase from £100,000 to £125,000 for direct descendants.
8. Capital gains tax thresholds rise
The threshold will increase from £11,300 to £11,700.
9. Junior Isa (Individual Savings Account) tax-free savings increase
The JISA allowance is increasing from £4,128 to £4,260.
10. Don’t miss the lifetime Isa deadline
Until the 6th of April, those that hold a help to buy ISA (individual savings account) can transfer the balance to a Lifetime ISA without expending their £4,000 annual allowance.
11. Car tax increases for diesel cars
New diesel vehicles that emit 191-225g/km of CO2 will attract a charge of £1,700.
12. Self-assessment gets simpler
Eligible taxpayers will receive a letter from HMRC and can simply confirm if the information is correct.
13. Stamp duty savings for many first-time buyers
Stamp duty has now been abolished for all first-time buyers on properties up to £300,000.
Westminster Wealth Management is able to assist in putting your personal finances in order, ensuring that your money goes towards building wealth for the future. Contact us today.
The value of investments and income from them may go down as well as up and you may not get back the original amount invested.
Information is based on our current understanding of taxation legislation and regulations which is subject to change.
A pension is a long-term investment. The fund value may fluctuate and can go down. Your eventual income may depend upon the size of the fund at retirement, future interest rates and tax legislation.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Our charges are usually between £395 and £995 depending on the type and amount of borrowing required and individual circumstances.
13 tax reforms that will hit your wallet in 2018