Tax Rebates & Refunds

Will you be better or worse off after the General Election?

April 19, 2010
Posted in Income Tax — Written by The Tax Repayment Agency

There was a very interesting article in The Telegraph on Saturday as they looked at how better or worse off you would be depending on who won the General Election.

Here’s a summary of the figures they came up with. Read the article for a full breakdown of what may happen under Labour, Conservative or a Lib Dem government.

Under a Labour Government

Labour have pledged not to increase income tax should they retain power, so under them your pay packet would not be affected any further. However, a pladge is not a promise, so don’t rule out an increase in income tax at some point in the future!

They will, however, increase National Insurance by 1% – that WILL bring down your monthly salary. They will also, in all probability all the parties will, increase VAT – so your weekly shopping bill will rise, for sure.

Under the Conservatives

Based on the Tories manifesto some people will be better off if they win the election. Here’s how.

A single person earning less than £35,000 will have £150 more a year in their pocket, based on the party’s pledge to reverse the 1% increase in National Insurance.

Married couples will be a further £150 better off thanks to the marriage tax. However, anyone earning between £45,000 and £55,000 will be worse off:

  • £45,000 – £294 lost
  • £50,000 – £546 lost
  • £55,000 – £213 lost

Under the Liberal Democrats

A Lib Dem government, in theory, has the most to offer most people. Their pledge to rase the tax free allowance to £10,000 means that anyone earning less than £113,000 will be better off.

  • Single person on less than £150,000 – £705 better off
  • Married couple earning £35,000 to £54,000 – £160 better off
  • Married couple earning £55,000 – £493 better off
  • Married couples earning less than £35,000 or more than £60,000 – £705 better off

None of these figures takes into account any change in the rate of income tax and while Labour have pledged not to change the rate, both the Lib Dems and the Tories have not ruled it out.

The article goes into greater detail, including what an increase in 1p on the basic rate would do. Check it out while you’re weighing up which way you should cast your vote.

And remember, if you think you might be entitled to a tax rebate then we can help.

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