In today’s budget it is proposed that the personal allowance will increase to £11,500 for 2017/18.
It is also proposed that the basic rate limit will be increased to £33,500.
As a result higher rate tax will only be charged on income which exceeds £45,000.
However, with the existing changes for interest, dividends and let property loan interest already announced people can find themselves unexpectedly within the higher rate due to the ways that these income sources are charged to tax.
It is therefore important to be aware of this and ensure that sufficient savings are made to cover the liabilities when they fall due.
