Our Guide To The Tax Year 2017/18

At the start of a new tax year, it can be difficult to stay up-to-date with the latest changes. With this in mind, we have created an in-depth guide, that highlights the key tax rates and allowances for 2017/18.

Changes to the ISA Limit

In the Spring Budget 2016, George Osborne announced the ISA allowance would increase from April 2017. The ISA allowance has now increased from £15,250 to £20,000.

Personal Allowance

The amount that can be earned before paying income tax has increased from £11,000 to £11,500. The change will mean around 20 million basic rate taxpayers will take home an extra £100 a year.

The threshold for higher–rate earners has also increased to £45,000. However, for those in Scotland the Personal Allowance is frozen at £43,000.

Other changes to personal allowance include: the Blind Person’s Allowance has increased to £2,320 from £2,290, and the Marriage Allowance has increased to £1,150.

Lifetime ISA Launch

The new Lifetime ISA is now available to UK residents aged between 18-40. The money saved can be used to buy a first home (worth up to £450,000) or withdrawn tax free after the age of 60. The Lifetime ISA allows you to save £4,000 a year and receive 25% top-up from the government.

Capital Gains Tax

The tax-free allowance for Capital Gains Tax has increased to £11,300. However, the charges will remain the same.

State Pension

The new tax year has seen changes to the Basic State Pension and the New State Pension. The basic State Pension has increased 2.5%, to £122.30 a week, an extra £156 over the year. The new State Pension has also increased 2.5% from £155.60 to £159.55 a week, providing pensioners an extra £200 over the year.