Chancellor Philip Hammond laid out his plans for the UK’s finances in the 2018 Autumn Budget on Monday. But not everything that will affect your bottom line made it into his speech.
A limited number of rabbits were pulled out of the Chancellor’s hat during the Budget announcement. This included an extension of the stamp duty cut to include first-time buyers using the shared ownership scheme, and a pay rise for workers with changes to the personal allowance and higher-rate tax threshold brought forward a year earlier.
Several announcements in the red book, however, revealed interesting developments that could affect you from next year.
Here, we round up the 10 things you might have missed in the Autumn Budget 2018.
1) State pension will rise by 2.6%
From April 2019, the state pension will increase by 2.6%, effectively giving pensioners a pay rise.
The state pension is protected by a triple lock guarantee, which means it goes up in line with whichever of the following is highest: CPI inflation, average earnings or 2.5%. In September 2018, CPI Inflation was announced to be 2.4%, while average earnings was 2.6%.
If you receive the state pension, your payments will be boosted as follows:
- The new single-tier state pension will increase to £168.60 a week – up from £164.35. This will leave pensioners £221 better off by the end of the 2019-20 tax year, with annual income up from £8546.20 to £8,767.20.
- The Basic state pension will rise to £129.20 a week – up from £125.95. This translates into an annual income boost of £169, taking the total annual income from £6,549.40 to £6,718.40.
Our graph below shows the amount of state pension you receive per week.
- Find out more: Autumn Budget 2018: state pension payrise confirmed
2) Pensions cold-calling ban confirmed
This year’s Budget confirmed that the pensions cold-calling ban will be brought in ‘as soon as possible’, which will make it illegal for companies to call you unsolicited offering pensions products.
The government confirmed, in its response to the cold calling consultation, that draft regulations implementing the ban will be published this autumn and will be brought into force 21 days afterwards.
The Information Commissioner’s Office (ICO) will be responsible for enforcing the regulations and any organisation that breeches the rules will be liable to pay compensation to the victim.
- Find out more: how to stop nuisance phone calls
3) £5m committed to the pension dashboard
The government confirmed it would give £5m to the Department for Work and Pensions (DWP) for the development of the pension dashboard. This would give people oversight over their pension pots and contributions.
A consultation will be launched by the DWP about designs for the dashboard and how it will be built.
The government’s funding commitment, however, has been criticised by some as insufficient.
Plans to introduce the pension dashboard were announced in March 2016 but have remained unclear. In support of the proposal, Which? launched a pension dashboard report and hosted a panel discussion during which the government backed the need for robust legislation and co-operation from the industry for it to succeed.
- Find out more: pensions – all you need to know
4) New Help to Buy scheme for first-time buyers
A new version of the Help to Buy Equity loans scheme will be launched in a couple of years time.
The revised scheme will run for two years from March 2021 to March 2023. Prices will be capped at 1.5 times the currently forecast average first-time buyer price in each region, with a maximum of £600,000 in London.
There are currently no plans for the government to extend the scheme beyond March 2023.
- Find out more: Autumn Budget 2018: new Help to Buy Scheme launched
5) Junior Isa allowance increase
Great news for younger savers was found in the Budget small print.
The Junior Isa allowance will increase in line with CPI inflation from April 2019 to £4,368.
It follows a rise in April this year, when the Junior Isa allowance increased to £4,260.
- Find out more: Autumn Budget 2018: Junior Isa allowance increases
6) Credit unions launch a premium bond-style saving scheme
The Red Book revealed that a premium bonds-style pilot scheme for credit unions will be launched early next year.
Around 10 to 15 credit unions will take part, offering prizes ranging from £50 to £10,000 on savings deposits.
The scheme aims to raise the profile of credit unions and encourage more people to invest their money.
- Find out more: savings alternatives
7) NS&I premium bond minimum investment decreased
The minimum investment for premium bonds will decrease from £100 to £25 in March next year, meaning that you’ll be in with a chance of winning for less.
NS&I will also allow people other than parents and grandparents to gift premium bonds to a child.
8) NS&I index-linked savings certificates linked to CPI
While bond holders have more flexibility, savers who hold NS&I index-linked savings certificates may lose out from next summer. From May 2019, the interest received on these certificates will switch from RPI to the consumer price index (CPI) measure of inflation.
RPI inflation currently sits at 3.3% whereas CPI is at 2.4%. The certificates are not on sale to new savers but existing holders who choose to renew could lose out on interest.
- Find out more: what are premium bonds?
9) No-interest loans pilot scheme to be launched
The government will be working with several debt charities and the banking industry to help design a pilot for no-interest loans early next year.
Depending on the outcome of the pilot, a new source of accessible and more affordable credit could be made available to communities across the UK.
- Find out more: personal loans explained
10) New Brexit 50p coin will be released
A new commemorative 50p coin will be released next year to mark the UK’s exit from the European Union.
The coin will be available for purchase from the Royal Mint from Spring next year as Britain prepares to leave the EU on 29 March 2019.
Its design will feature the 29 March date along with the words: ‘Peace, prosperity and friendship with all nations.’
- Find out more: Autumn Budget 2018: Brexit 50p coin to be released
11) Entrepreneurs’ relief qualifying period increased
From April 2019, the minimum period needed to qualify for entrepreneurs’ relief will be extended from one year to two years.
The measure is estimated to affect around 3,000 individuals who may wish to sell all or part of their business or shares in a company.
Business owners who sell up before at least two years have gone by will lose their entrepreneurs’ tax relief and will be liable to pay the normal rates of capital gains tax instead.
- Find out more: capital gains tax if you own a business
12) More flexible wedding venues
Wedding venues may sound like a surprising entry into the Red Book, but the government has asked the Law Commission to propose options for a simpler and fairer system of determining where people can get married.
This may include reducing red tape around the certification of wedding venues, and lowering the cost for couples.
Check out our live Autumn Budget 2018: what you need to know for a roundup of the Chancellor’s announcements during his speech and watch the video below for a breakdown of what this means for you.