How the mini-Budget tax cuts will affect you

Chancellor Kwasi Kwarteng's mini-Budget was full of tax cuts that will change your take-home pay

A couple walks through the door of their new house
First-time buyers will not pay stamp duty on property worth less than £425,000
(Image credit: Getty Images)

Last week Chancellor Kwasi Kwarteng announced a package of tax cuts aimed at getting the economy going. So what does it all mean for your finances? The big news is that income tax is being cut. From next April, the basic rate of income tax will fall from 20% to 19%. According to the government this will mean 31 million people will save £170 a year on tax.

On top of this the 45% additional rate of income tax will be abolished in April 2023. This is paid by anyone earning more than £150,000 a year. Getting rid of it will save someone with an annual salary of £200,000 almost £3,000 a year.

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Ruth Jackson-Kirby

Ruth Jackson-Kirby is a freelance personal finance journalist with 17 years’ experience, writing about everything from savings accounts and credit cards to pensions, property and pet insurance.

Ruth started her career at MoneyWeek after graduating with an MA from the University of St Andrews, and she continues to contribute regular articles to our personal finance section. After leaving MoneyWeek she went on to become deputy editor of Moneywise before becoming a freelance journalist.

Ruth writes regularly for national publications including The Sunday Times, The Times, The Mail on Sunday and Good Housekeeping, among many other titles both online and offline.