The December 2014 Autumn Statement:

If we focus on the changes taking place in April 2015, we have the following tax changes:

1. The Personal Tax Allowance is increased from £10,000 to £10,600.

2. The Basic Rate Tax Band is slightly down from £31,865 to £31,785. This means that from 6 April 2015, with the first £10,600 earned being subject to no tax, you will not start paying 40% tax on earnings until they exceed £42,385. This is marginally better than last year’s £41,986.

3. The Individual Savings Accounts (ISAs) annual limit goes up to £15,240 and all of this can be put into cash or into stocks and shares.

The Chancellor also announced a major change in the way Stamp Duty is charged on property purchase. Under the old rules the Stamp Duty was calculated at a single rate based on the band into which the purchase price fell. Now you will pay only the rate of the tax on the part of the property price within each tax band – like income tax.

The tax bands are as follows:

£125,000                                      nil

£125,001 to £250,000                  2%

£250,001 to £925,000                  5%

£925,001 to £1,500,000              10%

£1,500,001 and over                    12%

Examples of the new calculations for the tax versus the old calculation:

Purchase Price              Tax under                      Tax under

                                        old rules                         new rules

£125,000                           nil                                    nil

£275,000                           £8,250                            £3,750

average family home       

£510,000                           £20,400                          £15,500

average London home

This should give a boost to property purchases.