We know that the Government’s latest budget announcements will affect you if you are of working age.
The Government will reduce welfare spending by:
From April 2016, social housing rents will be reduced by 1% each year for the next four years. This means that your rent will reduce. We will write to you nearer the time with your new lower rent amount.
If you earn more than £30,000 per year you will be required to pay a market or near market rent for your property. Currently all our rents are below market value so this will mean that if you earn over £30,000 your rent is likely to increase. It is still unclear how this will work and details on how to implement this have not yet been released by the Government. We will keep you updated as we hear more about this.
The Government will introduce a National Living Wage of £7.20 an hour for the over 25s from April 2016. This will rise to over £9 an hour by 2020 and will apply to full time and part time staff. If you are currently on minimum wage – you will see your wages increase.
The Government will increase the tax-free personal allowance, currently £10,600, to £11,000 from April 2016 with plans to increase it to £12,500 by 2020. This means the first £11,000 of your income will be tax free and applies to everyone earning up to £100,000. The amount people will have to earn before they pay tax at 40% will also increase from £42,385 in 2015-16 to £43,000 in April.
From September 2017, free childcare will be extended from 15 hours to 30 hours per week for 3 and 4 year olds. This will mitigate the impacts of the change in the conditions in Universal Credit which states that parents of 3 and 4 year olds will have to be available for work (currently they don’t if they are looking after children as this is seen as a valid reason for being unemployed) which comes into effect in April 2017.
To support working people across the country, the government will cap regulated rail fares at RPI for the remainder of this Parliament.
Our MoneyWise Team can help - if you would like to speak to the team please call 01270 503575 or use the form below.