What the Budget means for you

Chancellor of the Exchequer George Osborne outside 11 Downing Street, London. Photo: Dominic Lipinski/PA Wire
Chancellor of the Exchequer George Osborne outside 11 Downing Street, London. Photo: Dominic Lipinski/PA Wire

HERE are the main points from the Budget and how they will affect you:

TAX

•The income tax personal allowance is to rise to £10,800 next year and £11,000 the year after, making typical working taxpayer £900 a year better off and cutting tax for 27 million people.

•A penny a pint will be knocked off beer duty, cider duty will be cut by 2% and duty on Scotch whisky and other spirits also cut by 2%. Wine duty frozen and duties on tobacco and gaming also unchanged.

•The fuel duty increase which was scheduled for September is cancelled.

•The transferable tax allowance for married couples to rise to £1,100.

•The share of income tax paid by the top 1% of earners is projected to rise from 25% in 2010 to more than 27% this year, while lower-paid 50% of earners pay a smaller proportion than under Labour.

•Employers’ national insurance for under-21s will be abolished from this April and for young apprentices from next April.

•The annual tax return will be abolished altogether, replaced by digital and online systems.

PENSIONS AND SAVINGS

•Law change to allow pensioners to access their annuities, with 55% tax charge abolished and tax applied at the marginal rate.

•Annual savings limit for Isa increased to £15,240 and a new fully flexible Isa created.

•A new Help To Buy Isa for first-time buyers allows the Government to top-up by £50 every £200 saved for a deposit.

•A new personal savings allowance from April next year means first £1,000 of interest on savings will be tax-free.

ECONOMY AND PUBLIC FINANCES

•Office for Budget Responsibility confirms that, at 2.6% UK growth faster than any other major economy last year.

•OBR revises forecast UK growth for 2015 upwards from 2.4% in Autumn Statement to 2.5% now. Forecast for 2016 revised upwards to 2.3%, then 2.3% in 2017 and 2018 and 2.4% in 2019.

•Mr Osborne said that people are better off at the end of this parliament than five years ago, with GDP per capita up by 5% and real household disposable income higher in 2015 than 2010.

•The average household is around £900 better off in 2015 than 2010, with living standards set to grow strongly every year until 2020, said Mr Osborne.

•OBR revises down inflation forecast for this year to 0.2%, and revises it down for the following three years.

•Treasury to sell at least a further £9 billion of Lloyds Bank shares in the coming year and launch sale of £13 billion of mortgage assets from Northern Rock and Bradford & Bingley.

•Borrowing forecast for this year revised downwards to £90.2 billion, then £75.3 billion in 2015/16, £39.4 billion, £12.8 billion in subsequent years - a total of £5 billion less borrowing than forecast in December.

•Budget surplus of £5.2 billion forecast for 2018/19 and £7 billion for 2019/20.

INVESTMENT AND SPENDING

•Funding provided for “major expansion” of mental health services for children and those suffering from maternal mental illness.

•A further £75 million from Libor fines paid by the banks to go to good causes.

•Some £1 million will go to buy defibrillators for public places, including schools.

•Additional money today to support the fight against terrorism.

•The £15 million fund for church roof appeals will be trebled, and extension to £8,000 in automatic gift aid will benefit 6,500 small charities.

•Government to provide £1 million to commemorate 600th anniversary of Agincourt.

•A new horse race betting right, and a consultation on tax support for local newspapers in England.

•Funding for wifi in public libraries and new national ambition for ultra-fast broadband to nearly all homes in the country.