Britain's Autumn Statement: So what difference did it really make?

On December 3rd 2014, The Chancellor George Osborne delivered the autumn statement which is the countries annual mini-budget. A short summary of how the statement affected groups within the economy is seen below.

There was good news for all workers in the sense that the £100 increase in the personal tax allowance was also extended to higher-rate taxpayers. But otherwise various groups will have less to cheer.

Older people with savings and no plans to move home will benefit the most. But Londoners planning to buy expensive properties will be cursing the Chancellor most loudly.

Many of our groups will suffer – or benefit – roughly the same.

But most have been promised more in the future in what was clearly a vote-grabbing Autumn Statement for the conservative party.

Single person:

It was pleasing news for all workers that income tax personal allowances will rise to £10,600 from April. The plan was to raise it to £10,500 but the Chancellor – presumably in a pre-election fever – managed to find a little extra cash to add to the fiscal budget.

The headline-grabbing stamp duty reforms will make it cheaper for a single person to get on the property ladder. Those at the lower end of the market will feel the benefits the most. Properties under £125,000 are still exempt from stamp duty.

However, if you get benefits then you may find times get even tougher in the future as the Chancellor has frozen working-age benefits as part of his welfare cap.

National insurance for apprenticeships are being frozen which should improve access to work and training.

Poor family:

George Osborne gave with one hand but potentially took away with another if you’re a hard-up family with a couple of kids.

The good news is that working families on low incomes will benefit from an increase in the personal allowance from next April.

It had been planned that the allowance would rise to £10,500 but a further £100 will be added to increase it to £10,600. The Chancellor also promised that the personal allowance would rise to £12,500 if the Tories win the general election. That would mean that no one on the minimum wage would pay income tax, he claims.

However, families getting workplace benefits will have less to cheer about. As part of a further £1bn in welfare savings, working-age benefits will be frozen for a further two years. Tax credits would be reduced where it was considered that payments are likely to be “certain”.

Middle-wage family

The annual summer holiday is going to get a cheaper. Air passenger tax was already set to be abolished for children under 12 from next May. However, from March 2016 children under 16 will also be exempt.

As for income tax, the first rise for a few years in the personal allowance for those paying the higher 40 per cent rate will introduced.

The amount that can be earned before 40 per cent becomes payable will rise from £41,865 to £42,385. On top of that, the Chancellor also signalled that after the election he wanted to see the 40 per cent income tax threshold rise to £50,000 by 2020.

Single parents:

Working single parents will be able to earn more from April before they are liable for income tax as the income tax threshold will rise to £10,600.

Those parents on benefits will be in for a harder time as a further £1bn is decreased off the nation’s welfare bill. As a result, working-age benefits will be frozen for two years.

Well-off family:

There was good news for your savings and holidays in the Chancellor’s statement, but potentially bad news if you’re planning to move home soon, depending on the value of your property.

The good news? You can transfer any saving you have in a tax-free Isa between partners and retain the tax-free status. The Chancellor also scrapped the 55 per cent “death tax” that currently applies when you pass an unused pension pot on to your loved ones, which could mean a substantial saving in the future.

But if you’re moving home any time soon, you will pay more stamp duty.

Pensioners:

The Chancellor’s main hand-out was aimed at older people. The most significant move which should help the most was the scrapping of the 55 per cent “death tax” on unused pensions.

But the new rule which allows Isa savings to be transferred to partners and retain their tax-free status will be of great benefit to those with a nest-egg.

All in all, has Mr Osboune's Economic plan be on course for prosperity in Britain or is Mr Osborne’s vote-grabbing Autumn Statement a ploy for the Tories to increase their votes five

months prior to the general election?