A report by the BBC highlights why April could be a month of tightening the purse strings in households all over the land, with a list of changes coming into effect throughout the month. A rise in the National Living Wage, an increase in personal allowance income tax threshold and changes to Inheritance Tax laws are just three areas the report pinpoints.
Income Tax: 20 million people are expected to benefit from a rise in the amount they can earn before paying income tax – from £11,000 to £11,500 per annum, whilst the higher 40% tax bracket threshold rises from £43,000 to £45,000 per year.
The National Living Wage: Over 25s will receive a 4% pay rise from April 1st, although that percentage falls to just 1.4% for workers aged between 21 and 24.
Lifetime Isa (LISA) and ISA Accounts: The new LISA becomes available from April 6th for those under-40s looking to save towards a property or pension – the government will pay a maximum of £1,000 as a bonus after a year. The allowance for existing ISAs increases from £15,250 to £20,000 on the same day.
Inheritance Tax: From April 6th an extra transferable main residence allowance of £100,000 will be able to be passed on tax free, with married couples and civil partners able to pass on £850,000 in total from their estates.
Council Tax: April 1st saw a 4% rise on average Council Tax bills in England.
Benefits: The new tax year will see most state benefits frozen for the second year in succession – whilst Child Tax Credit payment changes come into force on April 6th, which will adversely affect families with three or more children. Although no existing claimants are expected to lose out, future tax credits will be limited to two children, with larger families having payments capped.
April 3rd sees claimants of Work Related Activity Group payments out of pocket to the tune of £29 per week, whilst those claiming Universal Credits will be able to keep a larger slice of the money they earn before their benefits are reduced due to the ‘taper rate’ being reduced from 65% to 63%.
Prescription Charges: Rose from £8.40 to £8.60 on April 1st, with dental charges also increasing – a check up now costs £20.60 and a filling jumps £2.40 to £56.30.
Utility Bills: Water bills rise by 2% on average in England on April 1st, with electricity bills soaring from between 13.8% and 14.9% on April 28th – gas prices will also increase by 3.8% on April 26th… April 1st saw the cost of TV licence increase by £1.50.