Cameron pledges to raise income tax thresholds

David Cameron has pledged to raise the threshold at which income tax becomes payable, and also the threshold at which an employee would be liable to pay the 40p income tax rate.

Currently, income tax is payable once an employee earns £10,500. The prime minister has pledged to increase the threshold to £12,500 if the Conservatives are successful in the next general election, but the change could take time, with Cameron saying it will happen by 2020. It is estimated that the proposed change to the personal allowance would take 1 million people out of income tax, and reduce the amount of tax paid by 30 million more.

At the other end of the income tax scale, Cameron has pledged to increase the threshold for the 40p income tax rate from £41,900 to £50,000.

If you require advice on income tax, capital gains tax, inheritance tax, or general tax planning, contact Wilson Nesbitt in Northern Ireland by calling 0800 840 9288.