Pension savers to get £1,000 to spend on advice

Posted: Apr 21, 2016

The chancellor outlined two initiatives in the March 2016 budget that acknowledge the far-reaching pension reforms, which he originally announced in 2014. With more freedom than ever to use cash from their retirement funds, the government's thinking is that people have a greater need than ever for professional financial advice. If your employer arranges pension advice, you can will be able to claim tax relief up to £500 from April 2017. Currently the allowance is £150.

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Does pension beat property?

Posted: Jan 09, 2017

Andy Haldane grabbed a few headlines recently when in an interview with the Sunday Times he suggested his favoured investment for retirement savings was residential property. It is a view many people with a less profound understanding of economics would share, as evidenced by the popularity of buy-to-let property as an investment. Mr Haldane’s main justification for choosing property was that in the UK demand has consistently outstripped supply, which to an economist means prices can react only one way – “relentlessly heading north”. 

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Estate Planning with your Pension

Posted: Apr 10, 2017

It may sound strange, but your pension could be the last thing you should draw on in retirement.

Over the last five tax years the amount paid in inheritance tax (IHT), nearly all of which is collected on death, has risen by over 70%. However, there is one area where the IHT rules have become noticeably more favourable pensions.

A range of reforms has made defined contribution (money purchase) pensions, such as personal pensions, a valuable tool in estate planning. The broad rules are now:

• Pension death benefits are generally free of IHT. 

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How to avoid a tax charge after April's Pension Lifetime Allowance cut

Posted: Jan 06, 2016

The Government has published draft details of the protection regime that will apply after the lifetime allowance (LTA) is cut in April. Chancellor George Osborne announced the cut, which will see the LTA reduce from £1.25 to £1m, in the 2015 Budget. 

The Government's draft finance bill, published in December, provides information on how savers who have already built up pensions worth more than £1m can avoid a tax charge. 

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Financial planning: get ready for 2016

Posted: Jan 06, 2016

The new year will be marked by many changes that could affect your personal finances. 

The first year after a general election is often the time when major reforms take effect, especially those which create losers as well as winners. 2016 will be no exception. 
 

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New tax rules for dividends and interest

Posted: Feb 19, 2016

The tax treatment of your savings will be changing in April with important consequences.

The two Budgets of 2015 both made changes to the 2016/17 tax treatment of investment income.

Personal Savings Allowance

This new allowance will mean that if you are a higher rate taxpayer, the first £500 of interest you earn in a tax year will be free of tax. If you are a basic rate taxpayer, your allowance is £1,000. Additional rate taxpayers will not receive any of the new allowance.

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Should you still plan for inheritance tax?

Posted: Feb 19, 2016

Some people may have gained the impression from the last Budget that inheritance tax (IHT) is no longer an issue for most families.

After all, hasn't the IHT threshold  the nil rate band - been increased to 1 million? Unfortunately not. Since April 2009 there has been no IHT due on the first £325,000 of an estate. In the Summer Budget 2015 the Chancellor announced that this nil rate band would remain frozen at £325,000 until April 2021. This can be increased to as much as £650,000 by using the unused nil-rate band of a deceased spouse or civil partner.

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Cap set for residential care costs

Posted: Feb 19, 2016

The government has set a cap on how much you will have to spend on your long term care needs. But the cap won't now come in until April 2020 because of the cost.

The cap will mean that anything you (or your local council) spend on your eligible needs will be added together in your care account. Once it reaches £72,000, the council will pay for all your eligible needs. This proposed figure for the cap of £72,000 could be increased in line with inflation over the next four years.

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