The start of the new tax year brings a raft of changes that have consequences for your personal finances.
And with so much change afoot, it can be difficult keeping up with what’s going on.
To make things a little easier to digest, here’s a list of the major changes you simply can’t afford to ignore.
State Pension- Will it affect you?
It will most likely affect you. There is a NEW ‘single-tier’ State Pension and it will be given to anyone who reaches pension age (Check your State Pension age here) today or after and you have to be paying National Insurance contributions for a minimum of 10 years!
This will replace the Basic State Pension and other ones like the Second State Pension and Pension Benefit.
The way you save money– Whats this?
From 6 April, individuals with taxable income of between £17,000 and £43,000 a year will be eligible for a £1,000 tax-free allowance, meaning they can earn up to £1,000 per year in savings income without paying a penny of tax.
Wages- How are they changing?
The best way to explain this is to show you…
A new national living wage of £7.20: for employees aged 25 or over. This actually came into effect on 1 April – five days ahead of the start of the new tax year. This is an improvement of 50p per hour compared to the £6.70 workers aged 21 and over are entitled to through the national minimum wage.
New dividend tax allowance: This is also brand new and will affect all individuals in receipt of dividends, either from a company as part of a remuneration strategy or from investments that are not held within an ISA or pension.
Dividend tax credit rules replaced with a tax-free allowance: which entitles all individuals to the first £5,000 of income from dividends each tax year free from taxation.
Dividends over this level will be subject to tax and for basic-rate taxpayers this will be 7.5 per cent, higher-rate taxpayers will pay 32.5 per cent and additional-rate taxpayers will pay 38.1 per cent.
To get your business ready for the new tax year, call/visit our website today
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