With so many conspiracy theories and changes in policies, people have become exceedingly mistrustful of the Government. Conspiracy theories, movies and more speculation has only added fuel to this fire which makes people look at the government as a money hungry, controlling institution. On the other hand, if you don’t take the time to understand something completely, you will end up boxing yourself in and losing out on some amazing benefits.
If you’re looking to get your finances in order, here are some ways the government can help you save:
The New Personal Savings Allowance
Introduced in April this year, the new Personal Savings Allowance (PSA) has introduced a tax free allowance on any interest generated on your savings.
Based on the total amount of your income, you could fall under the basic rate or higher rate and enjoy around £1000 or £500 free of tax. Take a look at the table below to figure out where you fit in on the basis of your income.
|Tax Rate||Income Band (Adjusted Net Income)||Personal Savings Allowance|
|Basic – 20%||£43,000 or less||£1,000 or less (Tax free)|
|Higher – 40%||£43,001 till £150,000||£500 (Tax free)|
|Additional – 45%||£150,001 and above||None|
Increase in (Tax-free) Personal Allowance
Another Personal Allowance was also revised. The limit on the total amount of income generated to make one eligible to start paying income tax was also increased from £10,600 to £11,000.
This new allowance will become active from 2016 to 2017. For taxpayers, this is definitely an improvement from the previous years and they could end up saving more by the end of the year.
Mortgaging rules have been simplified with standardized fees being applied by the Council of Mortgage Lenders in order to ensure that buyers do not face any hidden charges. Fee descriptions and names have also been simplified, which now makes it easier to not only pick a mortgage but also draw clearer comparisons. This has made it easier for buyers to pick mortgages which suit their needs more.
Affordable Home Ownership Schemes
For many people, the goal is to save up and buy their own homes but with the current inflation and the condition of the economy; this is easier said than done. Luckily with government programmes and affordable housing schemes, you can get some amazing deals.
Help to Buy: ISA makes it possible for first-time potential buyers to save up for a home by depositing a certain percentage of their income which the government will then use to provide you an equity loan which comes up to around 20% of the total value of the property.
With schemes like these and more, it’s become easier to save money. While the state of the economy is not the best, at the moment, there are certain programmes, rules and initiatives being launched. All of these are launched with the aim of helping the average tax payer save money and live a comfortable and happy life.Read More