The new 50p top rate of income tax is hugely significant.
Patrick Stevens, tax partner at Ernst & Young, tells me that it’s the highest band for 20 years in the UK.
Margaret Thatcher abolished the 60 per cent rate in 1987/88 and replaced it with the 40 per cent rate in 1988/89. Continue reading "The Budget and income tax: an era ends"
By Steve Lodge, FT Money
The increase in the Isa limit to £10,200 a year sounds good - after all it’s £3,000 more than the current £7,200 limit.
However, it’s not exactly a windfall giveaway. Savers will be able to put up to £1,500 more into a cash Isa - £5,100 compared with the present £3,600. But with interest rates at record lows, the additional tax savings are worth just £9 a year for a higher rate taxpayer, according to KPMG. In addition, there are no instant winners here: the allowance increase only comes into force from 6 October for over-50s, while younger savers will have to wait until next April.
See our up-to-the minute personal finance Budget coverage
It is a gift for the Tories. And the timing is bizarre.
The International Monetary Fund has made its global economic predictions and the results aren’t too pretty for the UK. Continue reading "Things are going to be much worse: IMF"
Two thoughts on the politics of the 50 per cent tax rate.
1) Alistair Darling has given the Tories a ticket out of tax raising jail Continue reading "Did Darling let the Tories off the hook?"
By Matthew Vincent, FT Money
The complicated new system for reducing tax relief on pension contributions from April 2011 - which tapers the relief down from 40 per cent for those earning £150,000, to 20 per cent for those on £180,000 or more - will have more impact that at first realised. Eight per cent of higher-rate tax payers will be affected - approximately 280,000 people.
Continue reading "The Budget: how pension tax relief changes will affect high earners"
By Alice Ross, FT Money
Changes made to enterprise investment schemes in today’s Budget have been dismissed as “virtually meaningless” by an industry expert. Continue reading "The Budget: EIS changes under fire"
By Sharlene Goff, FT Money
First-time buyers in London who are hoping to take advantage of the extended stamp duty holiday may be disappointed. Buyers now have until the end of this year to escape stamp duty if they are spending less than £175,000 on property - an extra three months on what was announced in the pre-budget report last year. Continue reading "The Budget: disappointment for London housebuyers"
By Ellen Kelleher, FT Money
There will be some red faces in the City following this year’s Budget statement. Tax dodgers who misstate their yearly income and gains by tens of thousands of pounds face being “named and shamed” in public as part of a new round of efforts by the government to crack down on tax avoidance. Continue reading "The Budget: tax dodgers to be named and shamed"
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As Alistair Darling delivers his speech on Wednesday, our live bloggers will take you through the Budget. Join Robert Shrimsley, Jamie Chisholm and Matthew Vincent for the Budget live blog here at 12.30pm BST. We'll also have blog posts throughout the afternoon.