Income tax allowances frozen for two years and threshold cut for 45p rate by Jeremy Hunt | Personal Finance | Finance
Paul Barham, a partner at Mazars, added: “Income tax was always going to be in the government’s sights. With a gaping hole in the public finances, it’s an easy target for the treasury.
“Putting the thresholds on ice, and lowering the 45p tax band, is a double whammy and will raise billions for the treasury.
“Millions will be in the higher and additional rate tax bands in the coming years. And high earners will really feel the hit, with a higher proportion of their income subject to the 45 percent tax rate. Tax bills are only going in one direction for millions of people, and that is up.
“This makes tax planning even more critical. If salary sacrifice is an option through your employer, consider using it to reduce your taxable earnings or think about increasing your pension contributions.”
More to follow…