The current personal allowance rises from £10,600 to £11,000 as of 6 April.
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In today’s Budget, the Treasury announced: “Automatic deduction of savings income tax – the government will change the tax rules so that interest from OEICs, authorised unit trusts, investment trust companies and peer-to-peer loans may be paid without deduction of income tax from April 2017”.
‘There will be no forms to fill in, no tax to pay – it’s a tax break for the digital age and at least half a million people will benefit’.
The Chancellor, George Osborne, said the £2,000 jump was the single biggest above-inflation cash increase to the threshold since the 40pc rate was introduced by Nigel Lawson in 1989.
It will mean that individuals with online trading or property income will not have to declare or pay tax on the first £1,000 they earn from each source.
An eBay spokesperson said: ‘We welcome this personal tax allowance which shows that Britain is leading the way in recognising the rise of micro entrepreneurs.
“We were elected as a government for working people and we have delivered a Budget for working people”.
Speaking at the annual budget statement, the Chancellor said: “We’re going to help the new world of micro-entrepreneurs who sell services online or rent out their homes through the internet”.
“Cuts to Capital Gains Tax, changes to commercial stamp duty and plans to reduce Corporation Tax from 20% to 17% by 2020 are also welcome”.
This is good news for expatriates, who, for example, receive rental income in the United Kingdom for a property they have there.
But capital gains tax, which applies to all residential properties except the main home, will be subject to an eight percent surcharge, which leaves them at the original rate.
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Homeowners who use their homes to gain additional income by letting rooms through Airbnb have received a welcome tax break, while private landlords have been hit in the pocket.
