Yesterday the chancellor announced the 2016 Spring budget. They main changes which will affect families are changes in education.
Here are the main points:
All schools to become academies by 2022. This mean they will be independent, state funded schools. They will no longer receive their funding from a local authority but from central government. The head teacher will be responsible for the day to day running of the school and will overseen by academy trusts.
End of the 3.30pm bell. The government want Secondary schools to bid for extra funding to run after school classes in sport, art etc. There will be a fund of £285m to cover this.
A sugar tax on fizzy and high sugar drinks will be introduced in 2018 and will add 24p to a litre. This will raise £520m a year which will be spent on funding for sports in primary schools. The government hope that this will have an impact on childhood obesity.
The 40% threshold tax rate will rise from £42,385 to £45,000 in April 2017.
The Tax Free Personal Allowance will rise to £11,500 in April 2017.
Insurance premiums (house, car etc) will rise from 9.5% to 10%.
NI Class 2 contributions are to be abolished. Good news for some self-employed parents.
The Fuel duty is to be frozen for the 6 year.
Duty on beer, cider and spirits are to be frozen but will rise on wine and other alcohol.
ISA limit is rising from £15,240 a year to £20,000. Which means you can save you can save up to £20,000 a year tax free.
The government are introducing two new saving schemes:
Flexible Lifetime ISA – This is for under 40’s and they can save up to 4,000 a year to be used to but a first home or retirement up to the age of 50. The government will give them a 25% bonus each year.
Help to Save Scheme – This is for low earners. They will get a 50% bonus for every month they save £50. You could receive up to £1,200 over 4 years.
You can use this calculator to see how the budget will affect you and your family.