Happy New Year
The 6th of April marked the first day of the financial year. This brings a few changes to individuals and businesses.
The Personal Allowance
The personal allowance (the amount you can earn before paying Income Tax) has increased from £11850 to £12500. This will lead to a small reduction in tax. For higher rate tax payers the allowance will increase from £46,350 to £50,000.
The National Minimum Wage
The national minimum wage has changed on the 1st of April 19.
- For 25 years and older the minimum wage has changed from £7.83 to £8.21
- For 21-24 years the minimum wage has changed from £7.38 to £7.70
- For 18-20 years the minimum wage has changed from £5.90 to £6.15
- For under 18 year the minimum wage has changed from £4.20 to £4.35
- For an Apprentice the minimum wage has change from £3.70 to £3.90
The earnings threshold has also increased for paying back students loans.
- Plan 1 loans will rise from £18,330 to £18,935.
- Plan 2 loans will rise from £25,000 to £25,725.
This will apply to all current and future student loans where employers make student loan deductions.
The minimum amount for auto-enrolment has also increased. Employers now must contribute a minimum of 3% of the employees qualifying earnings (an increase of 1%). Employees must pay 5%. The total minimum contribution is now 8% (from 5%)
In preparation for the influx of personal tax returns we are preparing early this year. Our clients would have received an automatic email from Jade requesting information to complete their self assessment. This is not due to be submitted until January 2020, however we are aiming to have all tax returns completed by the end of the year!