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.
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
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.
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.
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.