Seven key points from the Autumn Statement 2012

AT A GLANCE

clock

The Chancellor George Osborne this afternoon delivered his Autumn Statement - the traditional annual update on the economy, public finances and government spending.

There were plenty of talking points (beyond Ed Balls's rather muddled response and Nick Clegg shaking his head when Osborne categorically ruled out a 'mansion tax').

Here are six of the biggest...

1 Economy

The economic growth forecast for this year has been cut to -0.1%, which, you guessed it, is down on the estimate given during the March Budget (growth of 0.8%). Beyond this year, the forecasts read: 1.2% in 2013, 2% in 2014, then 2.3%, 2.7% and 2.8%.

Seven key points from the Autumn Statement 2012

Of course, none of this prevented Osborne from trying the ol' lipstick-on-a-pig trick: his forst words this afternoon were "It's taking time but the economy is healing."

2 Pensions tax relief

The gloomy economic picture was expected to be the biggest news to come out of today's Autumn Statement, but there was another biggie: from 2014/15, the lifetime pension relief allowance will fall from £1.5m to £1.25m.

Additionally, the annual allowance is to be cut by a further £10,000 to £40,000. This comes only two years after Osborne slashed the allowance from £255,000 to £50,000.

The BBC's Robert Peston said the restrictions represent a £1bn tax increase for high earners.

3 Income tax

Good news: from next year, the basic income tax threshold is to be raised by £235 more than previously announced - to £9,440. Meanwhile, the threshold for the 40% tax rate is to rise by 1% in 2014 and 2015, from £41,450 to £41,865 and then £42,285.

4 Drawdown

The maximum income limit for capped drawdown is to be pushed back up to 120%. Though we don't know yet when this will happen. The limit was cut from 120% to 100% 18 months ago at the same time as the rules were altered to allow people to remain in drawdown beyond age 75.

5 IHT

The inheritance tax (IHT) threshold is to be increased by 1% next year, to £329,000.

6 ISAs

The contribution limit for individual savings accounts will, from next April, be raised to £11,520 (previously set to be £11,280). Osborne also said the government is consulting over allowing direct investment in Alternative Investment Market shares within ISAs, to boost enterprise.

7 State pension

The basic state pension will rise by 2.5% next year to £110.15 a week.

...and here are twoother notable changes...

1 Fuel

The 3p-a-litre increase in fuel duty, which was due to come in next January, has been cancelled.

2 Tax avoidance

Osborne said the Treasury expected to bring in some £5bn over the next six years thanks to a treaty with Switzerland to deal with undisclosed bank accounts.

More on Regulation

CII to reduce headcount by eight to 'deliver better outcomes'

CII to reduce headcount by eight to 'deliver better outcomes'

Forming plans to streamline processes and services

Isabel Baxter
clock 26 March 2024 • 1 min read
BIBA names Julie Comer as head of compliance

BIBA names Julie Comer as head of compliance

Helping members with compliance queries and concerns

Jaskeet Briah
clock 20 March 2024 • 1 min read
FCA unveils measures for more transparent enforcement cases

FCA unveils measures for more transparent enforcement cases

Consultation process initiated

Sahar Nazir
clock 27 February 2024 • 2 min read

Highlights

COVER Survey: Advisers damning of protection insurer service levels

COVER Survey: Advisers damning of protection insurer service levels

"It takes longer than ever to get underwriting terms"

John Brazier
clock 12 October 2023 • 5 min read
Online reviews trump price for young people selecting life and health cover

Online reviews trump price for young people selecting life and health cover

According to latest ReMark report

John Brazier
clock 11 October 2023 • 2 min read
ABI members with staff neurodiversity policy nearly doubles

ABI members with staff neurodiversity policy nearly doubles

Women within executive teams have grown to 32%

Jaskeet Briah
clock 10 October 2023 • 3 min read