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The old saying goes that nothing in life is certain but death and taxes, and many of us are complacent about tax as a result – we have to pay them, whether we like it or not, so why waste time or energy thinking about them?

However, when the new tax year starts on April 6th, a few changes are coming with it that could have more of an impact on your finances than you might think.

Read on for a rundown of the most significant tax changes and an interview with John Whiting of the Chartered Institute of Taxation.

Increase in the tax-free ISA savings allowance

This is one tax change that’s definitely good news – the new ISA allowance is £10,200, £5,100 of which can be saved in a cash ISA.

This means you can save an additional £3000 each year, without paying any tax on the interest, which could put quite a bit more money in your pocket in the form of interest.

Personal allowance stays the same – unless you’re a high earner

The personal allowance is the amount of money you can earn before you start to pay Income Tax. The personal allowance is being held at £6475 for those aged under 65, £9490 for those aged 65-74 and £9640 for those over 75.

In effect, this will mean slightly less money in your pocket – usually the personal allowance increases to allow for the effect of inflation and the higher cost of living.

There have been changes to personal allowances for very high earners however – they have been reduced for those earning over £100,000 and scrapped all together on incomes above £112,950 – meaning if you’re in this wage bracket you’ll pay more tax.

New 50% top rate tax for those earning over £150,000

The new tax year also see the introduction of a new top rate of Income Tax – 50% for those earning over £150,000. This will affect around 350,000 people.

The Income Tax brackets have otherwise stayed the same – 20% on earnings of up to £37,400 and 40% on earning of £37,401 to £150,000

Changes to the age at which you can retire and/or draw your pension

The current retirement age for women is 60, but this is set to gradually increase to 65 by 2020. So, if you’re a woman and you’re turning 60 after the 6th April this year, the date at which you can retire and draw your state pension will not be the day of your 60th birthday – you can use the DirectGov pensions calculator to work out exactly when it will be.

There are also changes regarding personal pensions – from April the age at which you can access your personal pension will increase from 50 to 55.

One positive change is that from April 6th, you will only have to have paid National Insurance for 30 years to qualify for the full basic state pension, while currently men have to have worked for 44 years and women for 39 years.

We spoke to John Whiting, Tax Policy Director at the Chartered Institute of Taxation, to find out more.

Q. Who are the losers in the tax changes that come into play on April 6th?

A. The short answer is: everyone (well, almost everyone). The main changes (50% tax rate, personal allowances phased out for incomes above £100,000, pensions tax relief restricted – already in hand) affect the better-off. But the fact that the basic personal allowance – i.e. the amount of income before income tax starts to bite – is to remain at £6,475, and all the other tax allowances and bands remain as they are, mean that more income is being dragged into the tax system and a greater proportion into the higher rates. The previously-announced increase in the Inheritance Tax threshold has been cancelled as well, so that stays at £325,000.

Q. Is there anyone who stands to gain from the changes?

A. There are some modest increases in Working and Child Tax Credits from April so that does mean some people on low incomes will be better off.

Q. Is it still important for people to make the most of their increased tax-free ISA savings allowance, despite low interest rates?

A. Arguably it’s even more important. If interest rates are low, making sure that as far as possible that the interest you do get isn’t cut into by the taxman must be key.

Q. Recently, there have been reports of tax code errors, how can people spot if they have an incorrect tax code and what can they do if they have?

A. The main thing to do is to take a look at the coding notice that you receive. It should show in the middle the personal allowance of £6,475 (or £9,490 if you are 65 or over, £9,640 for 75+). For many people that will be that: the amount of tax free income (which is what the personal allowance is) is translated to a tax code by dropping the last digit and adding a letter – so, typically, 647L.

A lot of people will have other amounts on the coding notice which adjust the tax code: perhaps extra amounts of allowances (e.g. blind person’s allowance) or (more likely) some restrictions to the allowances (e.g. for the state pension or for benefits in kind at work). Anyone with such adjustments needs to look carefully at them – do they make sense and mirror your circumstances? If not, call the HMRC number that is on the notice and ask for an explanation and, if necessary, a correction. Some of the problems we have seen include:

• Wrong state pension amount

• Taxable benefits double counted

• Tax underpayments for a previous year wrongly calculated

Also be suspicious if you get two or more coding notices. Another type of error that has come to light is that the personal allowance is allocated to an old job -so the taxpayer is given the tax free income against a job that they don’t have any more and which doesn’t generate any income. Meanwhile, the real job is allocated a ‘BR’ code (which means tax all the income at the basic rate of tax) or a much-reduced allowance.

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