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New tax year sees raft of new legislation

The beginning of the 2013/14 tax year sees the introduction of a raft of new tax measures affecting business and individuals.

A number of changes to the income tax regime came into effect on 6 April, including an increase in the basic tax-free personal allowance, taking it from £8,105 to £9,440.

Meanwhile, the threshold for 40% tax has been reduced from £42,475 to £41,450, and the personal allowance for pensioners has been frozen at £10,500.

However, the top rate of income tax, which applies to those earning more than £150,000, has fallen from 50p to 45p.

Changes to the benefit system have also come into effect, with most tax credits and working age benefits increasing by just 1%.

Chief Secretary to the Treasury Danny Alexander said that the tax changes will ‘make work pay’, but Shadow Chancellor Ed Balls argued that the reforms represent a ‘giveaway’ for the rich.

Also coming into effect is a new ban on the ‘excessive’ credit and debit card surcharges experienced by many consumers when booking items such as concert tickets, train tickets and hotel rooms.

Regulations now stipulate that payment surcharges must reflect the actual cost of processing the transaction.

A number of other measures take effect from 1 April 2013, including a reduction in the headline rate of corporation tax to 23% for non-ringfenced profits, the abolishing of the Financial Services Authority, the introduction of the new ‘patent box’ and an extension to the research and development (R&D) tax credit, and the first stage of the new £3.5bn Help to Buy scheme, offering 20% shared equity loans to those looking to buy a house worth up to £600,000.

For further information and advice on how the measures may affect you, please contact us.