New Tax Year Update
The new tax year has afforded the following changes –
Income Tax
The personal allowance has increased to £11,850 and the basic rate tax band has increased to £34,500. The threshold at which higher rate tax becomes payable has therefore increased to £46,350.
The married couple’s transferable allowance has increased to £1,190.
The dividend allowance has reduced from £5,000 to £2,000. The tax efficiency of dividend producing investments is becoming ever more important in mitigating potential tax liabilities.
Capital Gains Tax
The annual exempt amount for Capital Gains Tax has risen to £11,700. This may be of particular use when moving dividend producing investments into tax efficient wrappers such as Stocks & Shares ISAs via the Bed & ISA process.
Inheritance Tax
The Nil Rate Band has been frozen at £325,000 since April 2009. However the Residential Nil Rate Band has increased by £25,000 to £125,000.
Interestingly, Inheritance Tax receipts raised more than twice the revenue than it did in 2009/10.
ISAs
The overall ISA limit remains the same at £20,000. However, the Junior ISA (JISA) limit has increased to £4,260.
On this Day - 13th April 1743
Thomas Jefferson is born. Jefferson was the principal author of the Declaration of Independence and would later become the 3rd President of the United States of America.