TaxPersonal TaxBankers’ bonuses deferred to benefit from tax rate cut

Bankers' bonuses deferred to benefit from tax rate cut

Bonuses held back to April, when the higher rate of income tax was cut to 45%

Bankers’ bonuses deferred to benefit from tax rate cut

BANKERS’ BONUSES were deferred in what appears to be a bid to take advantage of a lowering of the highest rate of income tax to 45%.

Figures released by the Office for National Statistics find that the finance and insurance industries paid a total £1.3bn in bonuses in April 2013, compared with £0.6bn a year earlier. Bonuses paid in the rest of the economy were £2.9bn this April, compared to £1.9bn in April 2012.

In 2012/13, the average private sector employee received £1,700 in bonuses, approximately six times higher than the average public sector worker’s bonus of £300. However, private sector workers are on average in receipt of lower regular pay than people working in the public sector.

April 2013 also saw the increase in the personal allowance to £9,440, another change announced in the 2012 Budget. The top rate cut affects those on incomes of more than £150,000.

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