Chancellor George Osborne revealed his Autumn Statement on Wednesday, which outlined future plans for taxes and government spending.
Below is a list of some noteworthy announcements from the Autumn Statement that could affect your finances, investments, pensions and taxes over the coming years.
Fuel Duty
The 3p/litre rise in fuel duty that was scheduled for January has been cancelled.
Income Taxes
The government is raising the tax-free personal allowance by a further £235 to £9,440 in the 2013-14 tax year. This means that you will not pay tax on the first £9,440 that you earn in income each year.
The threshold for the 40% income tax rate is set to rise by 1% per year in the 2014-2015 tax year and in the 2015-2016 tax year. In simple terms: when you make above £41,450 in income per year, you will pay a 40% tax rate on the income you make that is above that £41,450 threshold. But that threshold will rise to £41,865 in the 2014-2015 tax year, and then it will rise again to £42,285 in the 2015-2016 tax year.
Pensions
In the 2014-2015 tax year, the government will cut back on some tax relief for pension contributions. The lifetime tax-relief allowance for pension savings will be cut from £1.5 million to £1.25 million and the annual tax relief allowance will be reduced from £50,000 to £40,000.
The basic state pension will rise by 2.5% to £110.15 a week in the 2013-2014 tax year. That is an increase of £2.70 per week.
ISAs
The ISA contribution limit for the 2013-2014 tax year will be raised to £11,520. The current maximum that you can put into an ISA for the 2012-2013 tax year is £11,280.
The government is considering allowing investors to buy and hold AIM shares within their stocks and shares ISA accounts. Osborne said this move would give a boost to small companies if it is implemented.
Pension Drawdown Policy
The government plans to increase the capped drawdown limit for pensioners of all ages to 120% of the value of an equivalent annuity. The rate had been set at 120% beforehand, but was brought down to 100% in 2010.
Corporation Taxes
Corporation tax is set to be cut by another one percentage point in the 2014-2015 tax year. This means businesses will pay a 21% tax rate starting in April 2014. Osborne says this is amongst the lowest corporate tax rates in the Western world.