Impact of the Budget 2012 for individuals – by Deanna Hurst, Private Client Department

The key points emerging from the Chancellor’s statement today are as follows:

INCOME TAX – From April 2013, the 50p top rate of tax will be cut to 45p

PERSONAL INCOME TAX ALLOWANCE – Raised to £9,205 from April 2013

PENSIONS – Age-related allowances to be removed for new pensioners from April 2013 to be replaced with a single personal allowance. Allowances for those of pension age to be frozen. Automatic review of state pension age so that it keeps pace with increasing lifespans. New single-tier state pension for future pensioners to be set at about £140 and based on contributions. No significant change to pensions relief.

CHILD BENEFIT – Phased out when a household has one person earning more than £50,000. It will fall by 1% for every £100 earned over £50,000. Those earning more than £60,000 will lose the entirety of the benefit.

STAMP DUTY – Immediate new stamp duty level of 7% on residential property purchases of more than £2m. Any such homes bought through companies will pay 15%. And don’t forget – on 24 March, 1% stamp duty tax will return on transactions between £125k to £250k

AVOIDANCE – New general anti-tax avoidance rule to be introduced. We will keep an eye on this!

ARMED FORCES – There were a number of announcements relating to financial support for families of the Armed Forces

There are other blogs addressing the issues for businesses

BBC News Budget Special Coverage http://www.bbc.co.uk/news/business-17372581

For further details on any of the issues covered in this update please contact Deanna Hurst, Partner in Private Client on 020 7583 2222 or email aem@royds.com

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