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2011 budget basics for over 50s

Posted in: Finance Last updated: 29 Mar 2011

Has this week’s budget left you bereft or better off?  We’ve put together some key pointers.

Potential savings

  • Personal tax allowance to rise to £8,105 from April 2012 (when added to the rise planned in April this year to £7475, it will mean a saving of £326 a year).
  • Council tax to be frozen or reduced across England.
  • 10% inheritance tax discount for those who leave 10% of their estate to charity.  (Inheritance tax is a tax on money or possessions you leave behind when you die, or in some instances, gifts made during your life.  A certain amount of a person’s estate– up to a value of £325,000 – is tax free, but above this it is taxed at 40%).
  • Fuel duty reduced by 1p.

Worth knowing about

  • Pensions: long term, the government aims to provide a £140 flat rate pension for new pensioners (with no means testing) which should help make pensions forecasting and planning clearer.  This will apply to new pensions when the change eventually comes into effect, but will not apply to those people already receiving the state pension.
  • No increases to personal tax.
  • The Support for Mortgage Interest scheme which helps unemployed homeowners cut their mortgage arrears, will continue for an extra year to January 2013.
  • Families in the South West may be able to get help with water bills.
  • No rise in air passenger duty planned for this year.

Costing more

  • No new duties on alcohol announced, but existing planned 2% above inflation increases on wine, beer and spirits will go ahead
  • Tobacco duty to increase by 2% above inflation

Not mentioned in the budget but definitely worth knowing about

  • The winter fuel payment top up (worth an extra £50 for the over 60s and an extra £100 for the over 80s) will expire.  This means the winter fuel payment for 2011/2012 will be  £200 for the over 60s and £300 for the over 80s.
  • The Chancellor suggested that inflation-linked tax free saving certificates may be re-introduced.

Note: Whilst we take care to ensure Hub content is accurate at the time of publication, individual circumstances can differ so please don’t rely on it when making financial decisions. OneFamily do not provide advice so it may be worth speaking to an independent financial advisor about your own circumstances.