Budget 2013: Support for childcare and mortgages announced
Measures to help individuals get onto the housing ladder and an acceleration in the tax-free personal allowance increase were among the personal finance highlights in Chancellor George Osborne’s 2013 Budget.
The announcements come alongside measures announced earlier in the week, including the bringing forward of the single-tier state pension and the capping of social care costs at £72,000 to 2016.
Key announcements affecting personal finances include:
A new Help to Buy scheme which will invest £3.5 billion in shared equity homes, helping those wanting to own a new-build home. A deposit of five per cent will attract 20 per cent of the value of new build homes from the Government – providing the property is worth less than £600,000. It will run for three years from January 2014. A Mortgage Guarantee scheme will also make £12 billion of Government money available to boost mortgage lending, subject to final design
A new tax-free childcare scheme will provide 20 per cent towards the first £6,000 of childcare costs for each child, to be phased in from Autumn 2015
The introduction of the single-tier state pension worth £144 is to be brought forward a year to 2016
The £72,000 cap on social care costs will also be brought forward a year to 2016. The Chancellor also announced an extension to the means-tested residential care threshold in the same year, although this is not yet confirmed
The personal tax-free allowance will increase by £560 to £10,000 from April 2014, a year ahead of the Government’s original plans
Under the employee shareholder scheme, the first £2,000 worth of shares will be free from income tax and National Insurance contributions, from 1 September 2013
The planned increase in fuel duty for September 2013 has been scrapped
The ‘beer duty escalator’ has been scrapped for next year and will instead increase in line with inflation. Beer duty will also be cut by two per cent from 25 March 2013, taking one pence off the price of a pint of beer
The Government will continue its drive to tackle tax evasion and avoidance in four areas including: offshore tax evasion; employment taxes; tax avoidance schemes and; corporation tax. To this end, agreements have been made with authorities on the Isle of Man, Guernsey and Jersey.