Autumn Budget 2017: What are the new personal allowances?

 
Caitlin Morrison
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General Views Of Government Ministries Around Westminster
The personal allowance has been raised again (Source: Getty)

The higher rate income tax personal allowance threshold will be raised to £46,350 from April, the chancellor has announced.

Meanwhile, the lower rate threshold will rise to £11,850.

The Treasury said this represents a £1,075 reduction in the amount of tax paid by the typical taxpayer in 2018-19, and a full-time worker on the National Living Wage will take home more than £3,800 extra.

"The increase of the personal allowance helps those on lower levels of earnings but exaggerates the anomaly of the tax system," said Tim Stovold, head of tax at Kingston Smith. "This creates a 60 per cent tax rate which now applies to earnings between £100,000 and £123,700 - and which will catch an increasing number of earners."

And Steve Webb, director of policy at Royal London, said: "In April next year, millions of workers will be asked to put more money in their pension, and it is vital that they do not opt out as a result. The chancellor should have done more to support household incomes next April to soften the blow of the pension contribution increase.

"Instead his meagre inflation-linked increase in the tax-free personal allowance means most people will still be out of pocket unless they also get a pay rise. This is a missed opportunity at a crucial moment in UK pension policy."

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