New tax year – 6 April

by | Apr 4, 2017

6 April – Income tax

The personal allowance increases from £11,000 to £11,500.

A £1,000 allowance for property income and a £1,000 allowance for trading income will come into effect from 6 April.

You won’t need to declare or pay tax if you have income from either source of less than £1,000.

If you have income above £1,000, you will be able to deduct expenses in the usual way or deduct the £1,000 allowance.

Inheritance tax

An additional nil-rate band of £100,000 will be introduced for property passed down to a direct descendant.

ISAs

The annual investment limit will increase from £15,240 to £20,000. The limit for a Junior ISA will rise from £4,080 to £4,128.

A new type of ISA – the Lifetime ISA – will be available for adults under the age of 40.

Individuals will be able to contribute up to £4,000 a year and will receive a 25% bonus from the government.

These savings can be used to purchase a first home once the account has been open for a year.

Alternatively, savings can be withdrawn for any reason from the age of 60. Withdrawing the funds at other times may lead a withdrawal charge of 25%.

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