The Institute of Financial Planning has commented on how the changes in today’s Budget will affect Financial Planners.

Contrary to many firms’ opinion on pensions, the IFP felt that most importance lay with changes to taxation.

The personal tax-free allowance is to be increased to £1,100 in April 2013, up from £8,105 to £9,205. This will then possibly pave the way for an increase to £10,000 in April 2014.

This is the largest increase in the level of personal allowance for 30 years.

There were also mentions of integrating income tax with National Insurance and a one per cent reduction in corporation tax.

Communications director Sue Whitbread said: “Given that so much of the detail had been leaked beforehand there were very few surprises.

“For tax planning, it’s useful that there were no changes to pension tax relief as had been mooted beforehand as possibilities. The changes in income tax and personal allowances, which had been widely anticipated, should provide some much needed stimulus to consumption and spending over the next few years.

“With so many people struggling to make ends meet, any reduction in the tax burden on working families is to be welcomed.”

She also spoke about wider economic forecasts. The Office of Budget Responsibility (OBR) has revised its growth forecast up from 0.7 per cent to 0.8 per cent. Next year is forecast to be two per cent. This means the Britain will avoid a ‘technical recession’, the OBR says.

She said: “The main priority is to see a return to higher rates of economic growth however despite more positive forecasts by the OBR mentioned today, this still remains a serious challenge given the situation in the Eurozone.”

• Financial Planner Online will be extensively covering the Budget this week with coverage of the announcements on the day and all the post-Budget reaction. It will be also be tweeting via our feed @FPM_Online.