Wednesday, 21 March 2012
How much is the tax cut worth?
How do you assess the rise in Personal Allowance to £9,205?
It will apply from 2013-14.
The 2012-13 figure is £8,105.
So, in comparison, a basic rate taxpayer would gain £220 in a year. (20% of the difference).
However, an RPI increase was already promised for 2013, which would suggest a gain of around £170 a year.
AND tax accountants have been working on the basis that 2013 would see a rise to £8,735 anyway, because the 2010 Budget Report implied that increase would come at a rate of £630 a year.
On that basis the gain for a basic rate taxpayer would be £94 a year.