Today’s Budget brought good news for UK taxpayers. We’re bringing you our Budget 2018 – It’s Personal!
If you’re a UK business owner too, have a read of our blog: Budget 2018 – The Business Bits
We’re just bringing the best bits here, otherwise you’ll slope off to Facebook or Insta!
Personal Allowance Increase brought forward
The personal tax free allowance will increase from £11,850 to £12,500 in April 2019. This is a big jump, and has been brought forward from 2020, so great news!
Everyone will be able to earn £1,042 per month before paying any tax. If you’re a company director, this is the amount to pay yourself from April 2019.
If you’re a sole director it’s more tax efficient to pay yourself up to the NIC threshold of £8,632, or £719.33 per month.
Higher Rate Tax Increase
This has also been increased from £46,350 to £50,000 from April 2019, an increase of £3,650.
Quick example 1:
The extra £3,650 at basic rate tax means a tax saving of £730 for personal tax. If you’re receiving dividends it’s a tax saving of £912.
Quick example 2:
If you’re a director taking salary and dividends, you’d pay £2,850 in tax if you take up to £50k, compared with £3,762 now.
National Living Wage and Minimum Wage Increase
Make sure you’re receiving the right amounts from your employer:
National Living Wage increases from £7.83 to £8.21 from April 2019 for over 25s
National Minumum Wage increases from £7.34 to £7.70 per hour for 21s to 24s
Apprentice Rate increases from £3.70 to £3.90
Stamp Duty Cut
This is being cut for shared ownership of homes worth up to £500k. Great news if you’re looking to buy. This is also being backdated to November 2017.
There will be more devil in the detail, when it comes out, but in all a good budget with extra tax free cash in our pockets. As always, if you’d like to discuss more, please get in touch.
Thank you for reading!
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