TaxPersonal TaxPersonal allowance rise will see another 230,000 families lose child benefit

Personal allowance rise will see another 230,000 families lose child benefit

Budget move to increase tax allowance for the most in need will catch nearly a quarter of a million more families in the higher rate band

Chancellor George Osborne

The raising of the personal tax allowance threshold in this year’s emergency
Budget could see almost a quarter of a million more families lose their child
benefit.

The decision in June’s Budget to increase personal tax allowance to £7,475
next April from £6,475 was accompanied by a lowering of the 40% higher rate
threshold to £42,375 from £43,875, so that only the most in need benefited from
the change.

This, the Daily Mail reports, will push another 230,000 workers with
families into the higher tax band and see them lose their child benefit. The
government has previously said that around 1.2m families would be affected by
the benefit cut.

Grant Thornton’s Mike Warburton has predicted that the higher rate threshold
could fall as low as £38,600, if the coalition government makes similar
adjustments when implementing its pledge to raise personal tax allowance to
£10,000. The Treasury has said there are no further plans to change the higher
rate allowance.

Further reading:

Tax concession to soften child benefit
blow

Child benefit cut piles pressure on
HMRC

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