Conservative Win and Your Money: What the Next Few Years Hold For You
After a historic election and a win for the conservative party it will perhaps be a few days before the reality hits home for many people across Great Britain. However, if the pledges by the Tory are anything to go by, every Briton will be affected no matter what life stage they might be in. Here are a number of the significant proposals you might want to familiarize yourself with.
The Tories promised a per-person new allowance of £175,000 transferable for civil partners and married couples on their main homes inherited by their children after their demise. It means that together with the nil-rate of £325,000 every individual has upon demise, parents will have the benefit of passing on their property inheritance tax free, up to about £1 million.
Pay could rise
In the new Conservative government dispensation, personal annually tax free allowance is expected to go up to £12,500 from £10,600. For higher rate taxpayers, expect more pounds in your individual pay packets as a result of a Conservative pledge to move up the 40% threshold to £50,000 annually from the current £43,386. The election winners also pledged fervently that income tax will not be going up, VAT or contributions to National Insurance. For lower-paid workers, the Tory promised to make their lives a bit better by raising the current minimum wage to about £8/hour within five years.
Money to purchase a house
Every first-time property buyer has been promised all kinds of schemes that would aid them to move up the property hierarchy. The Conservatives promised to have more homes build to raise supply as well as lots of initiatives to make it easy to own a home. A buyer who can raise a deposit of five percent can apply for an interest free five year loan from the government that’s equal to 20% of the value of a new build property within the Help to Buy Scheme extended to 2020.
Pension freedom and state pension
On 6 April, rules on pension freedom were ushered in, meant to ensure people are accessing retirement pots in a flexible way and can spend or invest the money as they want once they’re beyond 55 years old. Conservative Party had also promised pensioners they’ll maintain their fuel payments during winter for older members of society, TV licenses and free bus passes for every pensioner no matter how wealthy or poor they’re.
Nonetheless, for rich pension savers a Conservative government will really nip them since it promised to restrict pension contributions tax relief for anyone earning above £150,000 by lowering the yearly allowance on pension contribution.
As a younger saver in a pension, the Conservative government will definitely sting. The Lifetime Allowance will not exceed £1 million since going above that attracts hefty penalties.
The Tories pledged to cap the benefits from £26,000 to £23,000 annually and freezing benefits. Also, 18 to 21 year olds will see the Jobseeker’s Allowance removed and replaced with Youth Allowance provided for six months. Beyond six months you will have to engage in community work on a daily basis, traineeship or apprenticeship. Job Seeker’s on the allowance between 18 and 21 years of age will not be entitled to automatic Housing Benefit.
Extra free childcare
The new government had also pledge to see the weekly childcare doubling for every working parent to about 30 hours for those with children between 3 and 4 years of age, which is about £5,000 every year.