From April 1 we’ll all need to take a look at our budgets.
Because with a new tax year come plenty of changes which will hit us in the pocket.
It’s not all bad news – the minimum wage and state pensions are going up.
Council tax and charges are set to be hiked by nearly all English local authorities as a vast majority fear for their financial stability, a survey suggests.
Nearly all councils (95%) plan to increase council tax while 93% will hike charges to make ends meet, the 2018 State of Local Government Finance research conducted by the LGiU think tank and The Municipal Journal found.
The planned increases come against a backdrop in which 80% of councils fear for their financial stability.
Council tax can be hiked by up to 3% this year, in line with inflation, before a referendum is triggered, while authorities can also levy an additional “precept” to raise money for spending on social care.
The greatest immediate pressure on budgets came in children’s services (nearly 32% of councils), followed by adult social care (nearly 28%), and housing and homelessness (19%).
Adult social care was the greatest long-term pressure (nearly 38%), the survey said.
Minimum wage increase
The National Living Wage, which is the minimum rate paid to workers aged 25 and over, will go up by 4.4% to £7.83 an hour from April 1.
All other national minimum wages will also rise from the same date.
Alan Price is employment law director at Peninsula and he told the Liverpool Echo : “Employers need to be aware of these rate increases as a failure to apply them correctly could lead to enforcement action.”
We’ll all pay less income tax, but the rich benefit the most
The amount you can earn without paying income tax – known as the “personal allowance” – will rise from £11,500 to £11,850.
This will take a large number of low-earners out of tax.
However, as far as progressive policy goes it’s not popular with all the experts.
That’s because the change gives the same cash boost to all those earning more than £11,850, even if they’re millionaires who don’t need it.
And the amount the richest 13% can earn before paying the 40p rate of tax will also go up in April. It’s rising from £45,000 to £46,350.
The State Pension is going up
Thanks to relatively generous Tory policies (compared to other areas), pensioners are free of the freeze that’s hit others.
The old-style basic state pension will rise from £122.30 to £125.95 a week for an individual based on their own contributions (category A or B).
If you’re on the new state pension it’s a rise from £159.55 to £164.35 a week.
Each of these changes is a rise of 3% under the government’s “triple lock”.
The lock ensures pensions rise each year by 2.5%, average earnings or inflation, whichever is highest.