The Budget 2014 Highlights
March 21, 2014
Many of the changes revealed were re-announcements from the Autumn Statement of little more than three months ago. Nevertheless, the improving economic landscape did allow the Chancellor to spring a few surprises.
The Budget highlights include:
– Radical reform of pensions, effectively introducing flexible drawdown for all defined contribution schemes.
– Major relaxations to the rules for turning small pension pots into cash lump sums.
– Reform of ISAs, with a new £15,000 annual contribution limit and full transferability in both directions between stocks and shares and cash.
-The savings tax rate reduced from 10% to 0% and the savings rate band increased to £5,000, both from 2015/16.
– The personal allowance is increased to £10,000 for 2014/15 and to £10,500 for 2015/16, with small reductions in the basic rate band for both years.
– The transferable tax allowance for married couples is set at £1,050 for 2015/16.
– The annual investment allowance (AIA) is doubled to £500,000 and there is a one-year extension of the higher AIA to 31 December 2015.
– Seed enterprise investment scheme (SEIS) is made permanent and new rules are introduced for venture capital trusts (VCTs) and enterprise investment schemes (EISs).
– Higher premium bond investment limits and, from January 2015, a new series of National Savings & Investments fixed rate bonds for people aged 65 and over.