Autumn Statement 2013: Married couples to get tax break

Married couples will get a tax break from 2015, while low and middle income earners under 65 could pay less from next April, Chancellor George Osborne said in today's Autumn Statement.

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From April 2015, married couples and civil partners will be able to transfer Ј1,000 of their income tax personal allowance to their spouse, so long as neither pays higher rate (40%) or additional rate (45%) tax.

Choosing to transfer the allowance will mean one spouse pays tax on Ј1,000 less of their income. It'll benefit couples where one spouse doesn't use their full personal allowance – meaning together, they will pay less tax.

In future,

this transferable amount will increase in proportion to the personal allowance – the income you can earn before you pay tax.

Personal allowances will increase in April 2014 by Ј560 from Ј9,440 to Ј10,000 (see our Tax Rates guide for more information).

From April 2015 the personal allowance will increase in line with the Consumer Prices Index (CPI) rate of inflation.

Above the personal allowance, you currently pay 20% income tax on earnings up to Ј41,450, 40% on earnings between Ј41,451 and Ј150,000, and 45% on earnings over Ј150,000.

From April 2014, you'll pay 20% on earnings up to Ј41,865, 40% between Ј41,866 and Ј150,000, and 45% on earnings over Ј150,000.

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Source: www.moneysavingexpert.com

Category: Taxes

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