April tax changes: Will I be better or worse off?
Rather more prosaically, it also marks the beginning of the tax year.
If you are relatively well-off, the chances are that April will make you richer.
If you are in a low-paid job, you may also be better off, thanks to generous increases in the National Minimum Wage.
Pensioners and recent students will also have reason to celebrate.
However if you are responsible for paying council tax, your bill is likely to rise sharply.
Nine million workers will see their pension contributions triple.
And families on benefits could be more than £300 a year worse off.
Almost all taxpayers will be better off as a result of changes to income tax. The point at which workers start paying tax will rise from £11,500 to £11,850, saving basic-rate taxpayers some £70 a year. The level at which workers start paying higher rate tax (40%) will rise from £45,000 to £46,350, saving them an additional £100 a year.
However, the rise in income tax thresholds is only going up by inflation. The Institute for Fiscal Studies (IFS) points out that all other rises since 2010 have been more generous.
Rates for the National Minimum Wage – for those under 25 – and the National Living Wage – for those over 25 – are rising by more than inflation. The most generous increase is for 18 to 20-year-olds, whose salaries will rise by 5.3%. Those over 25 who currently earn the bare minimum will see an increase of 4.4%, or 33p an hour. Rates increase on 1 April.
From 6 April, former students will be able to earn more before they have to start paying back their loans. English and Welsh students who took out loans before September 2012, along with students from Scotland and Northern Ireland, will be able to earn £18,330 (up from £17,775) before having to make repayments.
However, English and Welsh students with post-2012 loans will see more significant benefits. Instead of having to start paying back at £21,000, they will now be able to earn up to £25,000. Someone earning £23,500 will save £18 a month, or £206 a year. Someone earning £27,000 will save £45 a month, or £530 a year.
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