Personal Allowances
The latest budget has confirmed that the basic personal allowance will be increased from the current £8,105 to £9,440 for 2013/14. The Coalition Government plan to ultimately raise the allowance to £10,000 from 2014/15. The additional tax rate of 50% is reduced to 45% for 2013/14 for taxable income over £150,000.
National Insurance Employment Allowance
The Government will introduce an allowance of £2000 per year for all businesses and charities to be offset against their Class 1NIC liability from April 2014. The allowance will be claimed as part of the normal payroll process through RTI (Real Time Information)
New Scheme for tax free Childcare
New tax incentives for childcare have been announced. To be eligible, families will have to have all parents in work, with each earning less than £150,000 a year, and not already receiving support through Tax Credits or Universal Credit. The relief will be 20% of the childcare costs up to a total of £6,000 per child per year. The scheme will therefore be worth a maximum of £1,200 per child. The scheme will be phased in from autumn 2015. The current system of employer childcare will continue to be available for current members or they can switch to the new scheme.
