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Tax Planning Thoughts - March 2019

March 15th 2019 – Written by Jonathan Chorley

Tax Planning Thoughts – March 2019

The Chancellor’s Spring Statement on Wednesday confirmed a number of tax measures introduced in the October Budget.

The highlights for individuals for the 2019/20 tax year include –

  • The Personal Allowance will be increased by £650 to £12,500. The Basic Rate limit will also be increased to £37,500. This means that the income level before higher rate tax becomes payable will be increased to £50,000;
  • The Capital Gains Tax (CGT) annual exempt amount will be increased by £300 to £12,000;
  • The Inheritance Tax (IHT) nil rate band will remain constant at £325,000. However, the residential nil rate band (RNRB) will be increased by £25,000 to £150,000. The combined band increasing to £475,000 – assuming that the main residence is left to a direct descendant;
  • Whilst the overall ISA allowance will continue at £20,000, the Junior ISA (JISA) and Child Trust Fund allowances will increase to £4,368;
  • The minimum contributions for auto-enrolled workplace pension schemes will increase with Employer contributions increasing to 3% of qualifying earnings and Employee contributions increasing to 5% of qualifying earnings.

Whilst improving tax efficiencies for individuals is a constant theme, it is most effectively employed at the beginning of the new tax year.

EST. 1999