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Spring Statement 2022 - what you need to know

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If you’re wondering how your household finances are going to be affected over the coming months, find out what the government has announced in its Spring Statement 2022. 

National Insurance threshold increased

Although the previously announced rise in National Insurance Contributions (NICs) will still go ahead in April 2022, the threshold at which you start paying NICs will increase from this July.  

At the moment, if you’re an employee, you can earn up to £9,570 (£184 per week) before you start to pay Class 1 National Insurance.

From 6 April 2022 this threshold will increase to £9,880 (£190 per week).

Then from July 2022, this threshold will increase to £12,570 (£242 per week) to match the standard personal allowance for Income Tax (currently £12,570 per year).

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Basic rate of Income Tax reduced

From April 2024 the basic rate of Income Tax will reduce from 20% to 19% in England, Wales and Northern Ireland.

The Scottish government has yet to announce if it will cut its basic rate of Income Tax.

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Rising energy costs

There was no further direct support announced for the rising cost of energy bills. 

The government did confirm it would continue to give local councils in England money for the Household Support Fund which provides additional support for low income or vulnerable families and can be used if you’re struggling to pay for food, household bills or other essential costs.  

If you live in England, contact your council to see if they have a welfare assistance scheme. Find help available in your area on the End Furniture Poverty website.  

There are separate schemes available if you’re living in Scotland, Wales or Northern Ireland.

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From April 2022, for five years, the VAT charged on energy-saving home improvements such as solar panels or heat pumps will be cut from 5% to 0%.

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Fuel duty cut

From 6pm on 23 March 2022 until March 2023, fuel duty will be cut by 5p per litre, across the whole of the UK.

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