Sam Brodbeck
Personal Finance Editor
Sam is personal finance editor at The Telegraph. He was previously head of news at trade newspaper Money Marketing. He writes Money & Daddy – a weekly column on parental finances.
Get in touch: sam.brodbeck@telegraph.co.uk / @sambrodbeck
24 Apr 2021, 5:00am
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16 Nov 2020, 5:00am
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Sam Brodbeck: Freezing allowances will leave you with less in your pocket
Make no mistake: we will all pay more tax as a result of this Budget. Mr Sunak may not have broken the manifesto commitment not to raise income tax, National Insurance or VAT, but freezing various allowances means you will (eventually) have less in your pocket. Wages and asset prices naturally rise, hence the logic of raising the amount we can earn or realise in capital profits before the tax man takes his cut.
Planned increases to the personal allowance and the higher-rate, 40 per cent, threshold have been delayed until April 2022, and then will be frozen. More and more people will fall into higher rate tax bands. Pension savers, so almost all of us, will also be penalised for saving and, most bizarrely, for healthy investment returns. The “lifetime allowance” on pensions pot will stay stuck at £1.07 million.