The Budget is the single most important economic and financial statement made each year by the Chancellor of the Exchequer to Parliament and the nation.
The budget in April 2012 stated that the Age Allowance would be frozen at the 2012/2013 values.
For 2012/13 the rules are that anyone who is 65 by 5 April 2013 will qualify for a personal allowance of £10,500 and anyone who is 75 by that date the allowance is £10,660. However, if the individual’s total income is more than £25,400, the allowance is reduced by £1 for every £2 by which income exceeds that figure, until it equals the basic personal allowance, which is £8,105 for 2012/13.
The allowance will be phased out by saying that only those who were 65 (or 75) by 5 April 2013 will qualify for the age allowance in 2013/14 or any future year. That means only those born on or before 5 April 1948 or 5 April 1938 respectively will qualify. In addition the allowance will be frozen at its 2012/13 value of £10,500 or £10,660 and it will be reduced once income exceeds a certain point, but that point has not yet been confirmed.
Those born on or after 6 April 1948 will only qualify for the basic personal allowance, which will be increased to £9,205 for 2013/14.