Tax Changes for 2018/19

 

Tax Changes for 2018/19

The 2018/19 tax year is upon us and a raft of new changes have come into force. Here's what to expect.

Income tax

The personal allowance has increased to £11,850 across the UK, and the higher rate threshold is increasing to £46,350 for England, Wales and Northern Ireland, with an addional rate above £150,000 of 45%.

Inheritance tax

The residence nil-rate band (RNRB) has risen from £100,000 to £125,000.

The RNRB enables eligible people to pass on a property to direct descendants and potentially save on death duties.

Capital gains tax

Capital gains tax allowance has increased to £11,700.

Changes were also made to the indexation allowance that is used to calculate capital gains tax, so that any assets bought after 1 January 2018 will not have any indexation allowance associated with them.

Dividends allowance

The tax-free allowance on dividends has reduced from £5,000 to £2,000.

Junior ISA limit

The Junior ISA limit has risen from £4,128 to £4,260. For adult ISAs, the allowance remains the same at £20,000.