24 November 2017 : 
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Cash in post-election

In one of the biggest surprises in British political history, the Conservatives won a majority in the House of Commons at the 2015 general election.

Despite securing just 36.9% of the vote, the Conservatives managed to limp over the finish line by securing 331 of the 650 seats on offer. It may be a slim majority, but it’s enough to form a government with David Cameron at the helm once again.

As most people were expecting a hung parliament, with either the Tories and Ireland’s DUP teaming up, or a Labour/SNP coalition, the Conservative majority has left many wondering how it will affect them.

We’ve been looking into the policies in the Conservative’s manifesto to see whether you will be a winner or a loser of the election result.

Taxes

The Tories plan to increase the threshold at which you start paying basic rate and higher rate income tax. Boosting the 40% barrier to £50,000 means that higher rate taxpayers get to keep more of their hard-earned cash. Cameron has also followed through with a Lib Dem policy from their time in the coalition, which will see the personal allowance rise to £12,500.

One of the most complained about taxes is inheritance tax, but Cameron has said that his government will make some big changes. The value of property that can be left to your dependents tax-free, will increase from £325,000 to £500,000.

Whilst not technically a tax, Cameron has insisted that the under-occupancy charge will remain during his next term. It’s thought that a million more families will pay the bedroom tax, helping the government save £250 million a year for the next five years.

Savings & pensions

It has been incredibly difficult for people to boost their savings accounts over recent years because the Bank of England base rate is still at an all-time low.

To help people reap the reward of saving, the Conservatives are introducing a new savings allowance that will mean more than 9 out of 10 people don’t pay any tax on their savings at all.

The State Pension is also due to increase, although not by much. However, the single-tier pension due to be introduced next year will pay a minimum of £151.20 a week.

Those due to retire in the near future will also be pleased to hear that annuities have been scrapped, meaning that over 55s can use their pension pot in any way that works best for them.

Benefits

Anyone reliant on welfare could struggle through the next five years if the Conservatives remain in power, as they plan to impose further cuts of £12 billion. George Osborne hasn’t yet confirmed where the axe will fall, but it’s expected to hit benefits hard.

What is known is that there will be a lower cap on household benefits, from £26,000 to £23,000, to help prevent people on welfare earning more than those in work. An emergency budget could be called to impose additional changes, but it’s not expected as the policies aren’t that different to those of the coalition.

Cost of living

Energy bills soared by around 150% between 2004 and 2012 – equivalent to around £800 a year. With gas and electricity bills taking huge chunks out of hard working families’ incomes, the Tories have some work to do to help make the cost of living more affordable.

One of the other topics up for discussion is petrol prices, but the Conservatives claim that you’ll be better off with them as they’ve scrapped Labour’s fuel duty escalator, and have had the longest freeze on duty in two decades.

Housing

If you’re looking to get onto the property ladder for the first time, you might be worried about how you’re going to save enough for a deposit, or whether you can afford the monthly repayments.

Mortgages are at their most expensive in years, with interest rates typically around 4% above the base rate. However, the Tories don’t seem to be keen on reducing them further as they’re confident that their economic plan is working.

That said, they do plan to build 200,000 starter homes for people under 40, and these will be sold at a 20% discount. There’s also the new Help-to-Buy ISA, which will benefit from government top ups.

It seems that the Tories are trying to become the new party of the working people; by helping those that contribute to the economy end up with more money in their bank account the end of the month.

Jemma Porter - Image Written by : Jemma Porter - Signature
Jemma is a news & research reporter for compareandsave.com.Having worked as a journalist on a number of personal finance websites; she now spends time researching and commenting on UK personal finance stories and investigating new ways to help our readers save money.For press enquiries, please visit our Media Centre page.

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