Whether you're a pensioner, a saver, an investor or even a motorist, chances are there were a few things that made you sit up and take notice during yesterday's Autumn Statement. We thought we'd take a look at some of the key demographics to see just what the policy changes could mean for you.
The announcement regarding pensions was arguably one of the key points of the statement, with Chancellor George Osborne confirming that the "triple lock" will be maintained on pensioner benefits. This means that the basic state pension will rise to £119.30 from 1 April and is touted as being the highest real terms increase to the state pension for 15 years, with the rise equating to £3.35 per week. He also confirmed that the full rate for the single tier state pension for new pensioners will be set at £155.35, giving those soon to retire a clearer understanding of what their income will be.
All sounds pretty good, right? Well, things may not be as rosy as they first appear. He went on to say that, taking all of the increases in basic state pension since the Conservatives formed a Government in 2010, pensioners are now £1,125 better off per year, but looking at private pension provision reveals a markedly different story, as our own analysis shows that the income earned from private pensions has actually fallen over the same period.
Landlords were dealt a particularly difficult blow in the Statement. It follows the general trend of setbacks to the industry, particularly in light of the cut to buy-to-let (BTL) tax relief announced in the Summer Budget earlier this year, and it seems that landlords now have to face a rise in stamp duty, too.
Osborne announced that stamp duty will rise by 3% on "additional rental properties", namely buy-to-lets and second homes, with the change set to come into effect from 1 April. However, while the move has been designed to ensure that first-time buyers (FTBs) in particular aren't prevented from getting onto the housing ladder by potentially deterring investors from buying prime FTB homes – something that's been welcomed by many – critics argue that it could come at a price, as landlords may need to pass on the rise in stamp duty to tenants, effectively raising rents in the process.
Savers found out that the ISA allowance will remain at £15,240 for the 2015/16 tax year (and at £4,080 for Junior ISAs), the first time that it hasn't been given an annual boost since the accounts first came into being. However, while some may lament the freezing of the allowance, it's not all bad.
The limit for the next tax year is typically decided based on the rate of inflation in the preceding September, and given that it was negative, we can rejoice in the fact that the allowance wasn't actually cut. Furthermore, from April next year the tax rules will change anyway – the first £1,000 in interest will be exempt from tax, which means that you can invest in traditional savings accounts (without an upper limit) and can still benefit in the same way.
First-time buyers were given several pieces of good news in yesterday's statement, as not only was there a commitment to build 400,000 new affordable homes by 2020, but new Help to Buy schemes were also announced.
Almost half of the promised 400,000 properties will be Starter Homes, sold at 20% below market value to first-time buyers, while 135,000 will form part of the new Help to Buy: Shared Ownership scheme. This should remove some of the restrictions on shared ownership, ideally making it a viable possibility for more prospective homeowners.
Then there's the London Help to Buy scheme, which will allow first-time buyers in the capital to purchase a property with the help of a 40% equity loan, provided they have a 5% deposit. Given how high prices are in London, the help of a loan will arguably come in handy, but there are concerns that it may not go far enough, with most properties still being out of reach for FTBs.
If you're fed up of compensation culture pushing up the cost of your insurance premiums, then you're in luck: motorists will no longer be able to get cash compensation for minor whiplash claims, George Osborne announced, in an attempt to stem the trend of people claiming compensation for exaggerated or fraudulent injuries.
The move is expected to reduce the cost of providing motor insurance by £1 billion, and Osborne expects the industry to pass on those savings – which could result in drivers seeing a typical saving of £40-50 a year on their car insurance. That's a definite bonus!
From free childcare and a tax credit U-turn to the delay of automatic enrolment and an energy supplier obligation that could cut £30 from your energy bills, there are simply too many changes to cover in the space of one article. It's safe to say that the Autumn Statement created winners as well as losers, and we'll keep our fingers on the pulse to let you know if there's anything else to fill you in on.
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