What the Autumn Statement means for Families
Very little help for families in Autumn budget
Yesterday Chancellor Philip Hammond gave his first Autumn Statement. Despite many predicting that he would include special measures to support ‘just managing families’ or JAMs, the new Chancellor provided very little for families in his budget. In fact he announced very few new changes at all; many of his points were simply reiterations of his predecessor George Osborne’s previously announced budget measures.
Nonetheless, here is our round up of some of the measures he did announce which will impact on families:
- Fuel duty will remain frozen for a seventh year, saving drivers £130 a year on average
- A new three-year NS&I Investment Bond will be available from spring 2017 – To support savers, the Bond will begin with an indicative rate of 2.2% from spring 2017. It will offer the flexibility to save between £100 and £3,000 and be available to those aged 16 or over.
- Personal Allowance, the amount you can earn before paying tax, will rise to £11,500 in 2017-18. It will increase to £12,500 by 2020-21. This is good news, particularly for those couples who claim Marriage Allowance as the amount that can be transferred to your partner will also increase.
- The level at which you begin to pay the Higher Rate will increase from £43,000 to £45,000 in 2017-18. It will rise to £50,000 by 2020-21. This will mean that more people will fall into the 20% tax bracket.
- The National Living Wage will increase from April 2017 – For those aged 25 and over it will increase from £7.20 per hour to £7.50 per hour.
- The National Minimum Wage will also increase, for 21-24 year olds it will rise to £7.05 per hour.
- There will also be some changes to the Universal Credit taper rate, it will be reduced from 65% to 63% from April 2017. Universal Credit will replace Tax Credits beginning from next autumn in Northern Ireland. The taper rate calculates your reduction in benefits as your salary increases, at the new rate you will keep 37p for every £1. As Universal Credit will be introduced in Northern Ireland from next autumn this means that all local claimants will automatically begin on the 63% taper.
- Most salary sacrifice schemes will become exempt from tax relief from April 2017. This means that if you claim a mobile phone or gym membership, for example, though a salary sacrifice agreement you will be have to pay tax. Pensions, pensions advice, Childcare Vouchers, Cycle to Work schemes and ultra-low emission cars will continue to be exempt. You will be able to continue making savings through these schemes.
Get in touch if you have any questions about what you and your family may be entitled to or call our free Family Benefits Advice Service on 0800 028 3008.
We can answer questions about all of the forthcoming changes to financial support, as well as carry out personal calculations to ensure that you are claiming all you are entitled to.