Where Does It Go? - UK Money Blog £

A new bill to factor into your expenses this year are the new car tax rules - if you’re buying a car first registered after 2001 then the car tax you pay is set to change, due next year.

If you buy a very fuel efficient car, you could pay no car tax, but a gas guzzler could cost you £455 a year.

A BBC information page gives you the typical tax for the leading cars being sold today, find it here.

You may need to bear this in mind if your selling a car from after 2001 also, since the car may have been instantly devalued, or you may be lucky to find it has increased in value, since buyers will factor in they will pay no car tax on a highly economical motorcar.

There has been some backlash from the press that this tax will affect the poorest more, and Gorden Brown also faces backbench rebellion due to it acting retrospectively, hitting drivers who had no knowledge of the tax when they bought their car.

Like many government initiatives at the moment, the measure seems to have good intentions (cutting CO2 levels) but hitting the wrong type of people in the pocket, which after all is the majority’s main concern.

Judging by the pressure on Gorden Brown recently, this measure could be taken down, but expect some kind of initiative targeting green cars soon.

Its been a real noticeable change in policy in the UK where environmental concerns take front stage - as a child in the 80s I remember such initiatives would have been part of the “loony left”.

Tags: cartax, budget tips, car

I keep meeting self employed people who haven’t heard of this scheme - which is a real shame as its brilliant. 

Basically the motive is to make it worthwhile for people to work - a lot of Tory propaganda in the 80s was aimed at the council estate single parent mum who had loads of kids to get benefits - it was more worthwhile to do that than to actually work. 

Tax Credits seek to correct that by making it more worthwhile to work - if you qualify you get a weekly or monthly payment to bump up your earnings.

If you work more than 30 hours (16 for parents) and earn less than roughly £15,000 - you qualify.

For self employed people this is even more attractive as the costs of the business as taken into account - only actual profit counts against the earnings.

My brother took on tax credits after many urgings from me when he was a musician in Cornwall - after arranging his NI contributions (£10 a month), he got in contact with tax credits - he sent in evidence of his work hours, a diary of jam practices and gigs, along with promotion posters, and recieved the tax credits within 6 weeks of roughly £45 a week.  Not enough to retire on sure, but worth enough to cover petrol getting around. 

One other thing to note is even if this year you are earning over the threshold, Tax credits works on the last tax year up to April - so if you earn £20,000 this year but only £6000 the year before - you may qualify.

Resources:

HM Revenue And Customs Info on Tax Credits

CAB Self Employment Checklist

Tags: taxcredits, budget tips, self employed