Britons 'unaware of tax changes'

Sam Jackson

March 15, 2011

November 13, 2018

Britons 'unaware of tax changes'

A total of 80% of Britons do not know about tax changes which will come into force at the beginning of next month, according to a survey.

There will be a rise in the personal allowance to £7,475 for people under the age of 65 who earn less than £100,000 at the start of the new tax year on April 5.

Personal allowances for people aged over 65 will also come into force.

Other changes include an increase in the amount of cash people can save tax-free into an Isa.

However, the threshold at which the 40% tax rate comes into effect will be lowered from £37,400 to £35,000.

The majority of people are unaware of the upcoming changes, according to research carried out by HSBC.

Awareness was particularly low among people on lower incomes, the group that the personal allowance benefits the most.

Nearly three-quarters of people did not know that the current tax-free personal allowance for people aged under 65 is £6,475, and 84% were unaware that the amount they can earn before they have to pay income tax is set to jump to £7,475 from the start of the new tax year.

Around 79% of people earning less than £5,000 a year and 70% earning less than £10,000 a year did not know about this tax break, suggesting significant numbers of people may be paying income tax unnecessarily.

Eight out of 10 of people did not know that those aged over 65 had higher personal allowances and 91% did not realise that there was a special band for people aged over 75, while nine out of 10 people did not realise that these allowances were set to rise in April.

At the same time, 65% of people did not know that they could currently save up to £5,100 a year tax-free into a cash Isa, while 82% were unaware that the sum was set to increase to £5,340 in April.

Sam Jackson

Money Dashboard

Subscribe for updates

Get the latest posts delivered right to your inbox

Success! Keep a look out in your inbox!
Oops! Something went wrong while submitting the form.