The Chancellor announced the 2024 budget this week (Wednesday 6th March), with some changes that could make an impact on your finances. Here are the key points that may affect you:
The Government will create a new tax-free ‘British ISA’, to be introduced from April. This will give those who open one an extra £5,000 tax-free allowance. The Chancellor said the new ISA would “ensure British savers can benefit from the growth of the most promising UK businesses, as well as supporting those businesses with the capital to expand.”
A new British Savings Bond will also launch in April, delivered by the state-owned National Savings and Investments. This will give a guaranteed rate, fixed for three years.
The National Insurance contribution rate will be cut from 10% to 8% of pay from April. This means that someone earning £25,000 a year will save £249 a year. It follows a previous cut from the autumn statement in November which saw the rate reduced from 12% to the current 10%.
The threshold at which parents are charged for claiming child benefit will be raised from £50,000 to £60,000. This will mean that nearly half a million households will save an average of £1,260 a year from April 2024.
The taper period has been extended and will go from £60,000 to £80,000 (previously £50,000 - £60,000). For every £200 of income over the £60,000 level, the child benefit will reduce by 1%. So any household with children where the highest earner earns between £50,000 and £80,000 will benefit to some extent.
There will also be a consultation to look at introducing a household based system to determine how it is applied. At the moment, eligibility for child benefit is based on individual salaries, but the aim is that it will apply to collective household income from April 2026.
To find out more about Aldermore savings accounts that could help your finances go further.