The Chancellor of the Exchequer, George Osborne, delivered his speech on Wednesday 16 March, his third in 12 months. In our Budget 2016 summary, we have provided information on the changes and key facts, and how they could have a bearing on your finances today and in future years to come.

 Retirement savings vehicle

Tax and savings were central to Mr Osborne’s 62-minute speech. He had already scrapped proposals to shake up pension tax relief and instead unveiled a retirement savings vehicle for millennials called the Lifetime Individual Savings Account (LISA). Ultimately, this is a testing ground for the Pensions ISA proposed before Budget 2016, and it gives the Government the option to see how consumers react to the ISA option.

Mr Osborne added that people under 40, many of whom haven’t had a good deal from the pensions system, would gain government bonuses for saving into their LISAs, receiving £1 from the Government for every £4 saved, at a maximum of £4,000 a year.

Creating wealth through capital gains

For investors, there was good news with the higher rate of Capital Gains Tax (CGT) being cut from 28% to 20%, which comes into effect from April this year. Now it is even more attractive to create wealth through capital gains rather than earnings for higher-rate taxpayers on all gains apart from on residential property or ‘carried interests’. The details are to follow, but this will enable investors to benefit by realising the profit on the sale of shares and other assets at the reduced rate of tax.

 Earnings threshold raised

The Chancellor raised the earnings threshold at which you start paying Income Tax, from £10,600 to £11,500 from 6 April 2017. Higher earners were originally paying 40% tax on income over £42,385, but this threshold now rises to £45,000 from 6 April 2017.

Measures to target tax avoidance

Plans have also been laid out to raise £12bn by the end of this Parliament through a package of measures to target tax avoidance. The Government will introduce new measures to tackle disguised remuneration and make sure UK tax is paid on property development.

Now we’ll run through the key points to take from the budget:

ECONOMY

• Growth forecast to be 2% in 2016,down from 2.4% in November’s Autumn Statement
• GDP predicted to grow 2.2% and 2.1% in 2017 and 2018, down from2.4% and 2.5% forecast previously
• Inflation forecast to be 0.7% for 2016, rising to 1.6% in 2017
• UK still forecast to grow faster than any other major Western economy
• A million jobs forecast to be created by 2020

PERSONAL TAXATION

• The threshold at which people pay 40% Income Tax will rise from the current £42,385 to £45,000 in April 2017
• Tax-free personal allowance (the point at which people pay Income Tax) to rise to 11,500 in April 2017
• Capital Gains Tax to be cut from 28% to 20%, and from 18% to 10% for basic-rate taxpayers
• 5% rise in Insurance Premium Tax
• Class 2 National Insurance contributions abolished

PENSIONS AND SAVINGS

• Annual Individual Savings Account (ISA) limit to rise from the current £15,240 to £20,000
• New ‘Lifetime’ ISAfor the under40s, with government putting in £1 for every £4 saved
• People will be able to save up to £4,000 a year until they turn 50
• New state-backedsavings scheme for low-paid workers, worth up to £1,200 over four years
• The Money Advice Service to be abolished

HEALTH AND EDUCATION

• Introduction of a new sugar taxon the sot drinks industry to be introduced in two  years’ time, raising £520m a year to be spent on doubling funding for primary school sport
• Levy to be calculated on levels of sugar in sweetened drinks produced and imported, based on two bands
• Pure fruit juice and milk-based drinks to be excluded, and small supplies will be exempt
• Secondary schoolsin England to bid for new funding for extra afterschool activities like sport and art
• Plan for all schools in England to become academies by 2022
• Compulsory maths lessons until 18 to be considered
• £500m to ensure ‘fair funding’ formula for schools in England
• Libor funds to be spent on children’s hospital services, specifically in Manchester, Shefield, Birmingham and Southampton

BUSINESS

• Headline rate of Corporation Tax – currently 20% – to fall to 17% by 2020
• Anti-tax avoidance and evasion measures to raise £12bn by 2020
• Annual threshold for small business tax relief to be raised from £6,000 to a maximum of £15,000
• Supplementary charge for oil and gas producersto be halved from 20% to 10%
• Petroleum revenue tax to be ‘efectively abolished’
• £9bn to be raised by closing corporate tax loopholes
• Use of ‘personal service companies’ by public sector employees to reduce tax liabilities to end
• Commercial stamp duty 0% rate on purchases up to £150,000, 2% on next £100,000 and 5% top rate above £250,000. New 2% rate for high-value leases with net present value above £5m

HOUSING/INFRASTRUCTURE/TRANSPORT/REGIONS/ENERGY/CULTURE

• Powers over criminal justice to be devolved to Greater Manchester and Greater London Assembly to retain business rates
• New rail linesto get green light, including Crossrail 2 in London and the HS3 link between Manchester and Leeds
• More than £230m earmarked for road improvements in the north of England, including upgrades to M62
• £700m for flood defences schemes, including projects in York, Leeds, Calder Valley, Carlisle and across Cumbria
• Tolls on Severn River crossings between England and Wales to be halved by 2018
• £115m to tackle rough sleeping and homelessness
• Scotland, Libor bank fines to pay for community facilities in Helensburgh and for naval personnel at Faslane
• New elected mayors for cities and towns in southern England
• New Shakespeare North theatre in Knowsley, Merseyside

MISC

• Fuel duty to be frozenat 57.95p per litre
• Beer, cider and spirits duties to be frozen
• Excise duties on tobacco to rise by 2% above inflation