1.25% tax hike to cover social care costs

The launch of a social care levy from 2022 will see all taxpayers facing a 1.25% tax charge under government plans, while dividend tax will also rise

From next April the government will create a UK-wide, 1.25% health and social care levy on earned income, hypothecated in law to health and social care, with dividends rates increasing by the same amount. There will also be changes to the amount of savings people can retain when facing a move into care costs and a cap on total cost liability for anyone paying for care home accommodation and care.

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