UK Chancellor George Osborne’s eagerly awaited Autumn Statement has given some people reasons to be cheerful and others, reasons to feel frustrated. But ’tis the season to be jolly; so here are seven highlights from this year’s Autumn Statement, which Osborne clearly hopes will bring some festive cheer.
#1 Stamp duty overhauled
Prospective homebuyers will no longer have to pay stamp duty on the entire cost of a property. Instead, they will pay stamp duty in a similar way to income tax, with the rate increasing only on a portion of the price of the property. According to the Statement, almost all homebuyers will be better off. Here are the new thresholds:
- Zero stamp duty on properties less than £125,000
- 2% stamp duty on property prices between £250,000 and £925,000
- 10% stamp duty on property prices between £925,000 and £1.5 million
- 12% stamp duty on property prices higher than this
#2 The North will get lots of money
Osborne has put forward a vision of a “northern powerhouse”, and he’s putting his money where his mouth is. A not insignificant 7 million will be ploughed into the North to boost its infrastructure. Northern research centres will also get more money to enhance their status as centres for science and innovation.
#3 Good news for workers
The personal allowance, which is the amount of tax-free pay an employee can earn each year, will go up £100 to £10,600. This frees 3.5 million people from having to pay any income tax. Those who pay the higher rate of tax will also benefit: the 40% income tax threshold will go up to £42,385 from £41,865 next April, meaning that 138,000 will be taken out of the higher rate of tax.
#4 Good news for those doing postgraduate master’s courses
If you are under the age of 30, you will be entitled to an “income-contingent loan” for any master’s course. Loans of up to £10,000 will be available from 2016-2017, so students from the poorest backgrounds can benefit from postgraduate education.
#5 Spouses can inherit their dead partner’s savings
A surviving spouse will be able to inherit the ISA savings of their partner without incurring any tax penalties.
#6 Good news for High Street businesses
Osborne’s Statement reveals plans to review the challenges that businesses face regarding business rates – widely believed to be the reason for the ‘death’ of Britain’s high streets. Business rates increases are set to be capped from next April 2015 at 2%. The chancellor has also announced measures to increase the “high street discount” offered to “shops, pubs, cafes and restaurants” - by £500. In addition, the Small Business Rate Relief has been doubled for an extra year which means that 380,000 small businesses will not be required to pay business rates.
#7 Kids go free - from air passenger duty
Children under the age of 12 will no longer have to pay tax when flying abroad (on economy flights). This represents a saving of up to £142 for a family of 4 on a long haul flight to the States.
It’s not surprising to see a number of vote-winning measures before a general election, but these measures are welcome, nonetheless. Certainly, not everyone will be opening the Prosecco – there will be many who feel hard-done-by by some of the measures in the Statement.