Autumn Budget 2017 explained
What the changes could mean for you
How could the Autumn Budget affect your finances? Read our summary of the headline changes.
Browse the key topics below.
Stamp duty scrapped for up to 80% of first-time buyers
Looking to get on the property ladder or help someone buy their first home? In the Autumn Budget, the Chancellor announced a cut in stamp duty for first-time buyers. Under the change, coming into effect immediately, first-time buyers will pay no tax on properties up to £300,000, and those buying properties valued at up to £500,000 will only pay stamp duty over the £300,000 threshold. “This may just encourage the bank of mum and dad to help out more, safe in the knowledge that their cash is not going to the Treasury,” says Lucian Cook, Savills Head of Residential Research. The system for Scotland is different, and the change will not apply.
Boosting the housing supply
The Autumn Budget saw the Chancellor commit to a new housebuilding drive, pledging at least £44bn over the next five years to tackle the housing crisis. The government’s aim is to build an average of 300,000 homes a year by the mid-2020s. “This announcement starts addressing some of the challenges in our housing market and the focus on improving supply of new homes is welcome,” says Stephen Jones, Chief Executive of UK Finance.
In a motorist-friendly move, the Chancellor has cancelled the planned fuel duty rises for petrol and diesel. Fuel duty has now been frozen for the longest period in 40 years, he claimed. According to RAC spokesman Peter Williams, the continued freeze shows the Chancellor has listened to motorists and business owners “struggling with higher prices at the pumps”.
Owners of new diesel cars could face a one-off tax increase, however. The Chancellor announced that new diesel cars, registered from 1 April 2018, that do not meet emissions standards, will have increased vehicle excise duty for their first year. “Drivers buying a new car will be able to avoid this charge as soon as manufacturers bring forward the next-generation cleaner diesels,” he said.
A boost for train travellers
To support young people, the Chancellor, Philip Hammond, announced the extension of the 16-25 railcard to include anyone up to the age of 30. This would bring about 4.5m more people into the scheme, the Chancellor said. Following a trial in the Greater Anglia area next month, the card will be rolled out nationally next spring. For an annual charge of £30, the railcard offers a 33% discount on rail travel at non-peak times.
Universal Credit update
Universal Credit brings together a number of benefits for people of working age into one payment. However, recent reports say some people have been getting into debt and rent arrears while waiting for the benefit to be paid1. To ease the situation, the Chancellor announced changes to the way Universal Credit will be implemented in the Autumn Budget. The measures include a reduction in waiting time for new claimants; a full month’s advance payment for anyone struggling financially and an extension of housing benefit for claimants for an extra two weeks.
Tax and wages
Raising the tax allowance and the National Living Wage
The Chancellor stressed the government’s commitment to support workers in his Autumn Budget. The personal allowance will be raised from the current rate of £11,500 to £11,850 in the 2018-19 tax year, while the higher-rate tax threshold will increase to £46,350 from £45,000, in line with inflation. Different income tax bands may apply to your income if you live in Scotland.
In addition, Hammond announced increases to the National Living Wage, which is paid to workers aged 25 or over. From next April, it will rise from £7.50 to £7.83 an hour.
The effects of tax rules on you will depend on your individual circumstances and are subject to change. Barclays is not a tax adviser and does not provide personal tax advice.
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