Managing your finances can often feel straightforward, particularly when it comes to day-to-day budgeting or saving for short-term goals. But some financial decisions carry long-term consequences that are far from simple. In these instances, the stakes are higher, the options more complex, and the implications far-reaching - not just for you, but for your family too. These are the moments when seeking professional financial advice is not just sensible but crucial.

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Advice on estate planning

Gifting Property to Your Children:

One of the most common motivations for gifting property is to help children onto the housing ladder or to reduce the value of an estate for inheritance tax purposes. However, this seemingly generous act can trigger unexpected tax complications and financial risks if not handled carefully.

Transferring ownership of a property can have implications for capital gains tax, especially if it is not your main residence. When considering inheritance tax, if you gift a property that is worth more than your Nil Rate Band (NRB) or joint NRB (or joint owners, usually both parents) then if you pass away within 7 years, the beneficiary of the house is liable to pay the 40% inheritance on the value of the gift above the NRB. This provides complications to the beneficiary as they may be forced to sell the property or have to set up a regular arrangement with HMRC to pay the inheritance tax due.

In addition, should you continue to live in the property after gifting it, you may fall foul of the “gift with reservation” rules, which mean that HMRC could still treat the property as part of your estate for inheritance tax purposes.

Moreover, giving away significant assets could impact your financial security in later life. Once a property is legally transferred, you lose control over it. This can be detrimental to your later life planning such as paying for care costs. If your child were to go through divorce, bankruptcy, or pass away unexpectedly, that property could become part of a legal or financial settlement. These are difficult possibilities to consider, but failing to plan for them could create avoidable hardship.

Seeking financial advice can provide you with peace of mind when gifting away assets, ensuring that they are absolutely surplus to your requirements and allow you to plan appropriately.

Passing on wealth:

Estate planning goes far beyond writing a will. It involves a careful review of your assets, liabilities and how best to pass on wealth to future generations in a tax-efficient manner. Inheritance tax, currently charged at 40 per cent on estates over £325,000 per individual, can significantly reduce the value passed to your heirs if not planned for in advance. Also, for those passing down their main residence to direct descendants, an additional £175,000 Residence Nil Rate Bands (RNRB) per individual is available (on net estates valued up to £2 million), meaning up to £500,000 for an individual or £1 million for married couples/civil partners could be passed down free of inheritance tax.

A direct descendant is classified as your spouse/civil partner, children (adopted, fostered and stepchildren) and grandchildren.

From making use of available allowances and reliefs, to setting up trusts or using life insurance to cover tax liabilities, there are many tools available to reduce the impact of inheritance tax. Missteps can lead to unintended tax bills, loss of asset control, or disputes among beneficiaries.

Advice using equity release

Equity release has become an increasingly popular option for those seeking to unlock the value in their home without selling it. Whether you're looking to supplement your pension income, fund home improvements, or gift money to family, releasing equity can be appealing. It’s even an option for some with large estates looking to lower the value of their estate for inheritance tax purposes. However, it's not a decision to take lightly.

Equity release products, such as lifetime mortgages, can have long-term financial consequences. While you do not need to make monthly repayments, interest is typically rolled up and added to the loan, which can significantly reduce the value of your estate over time. If not for the intended purpose of lowering your estate, this may impact what you are able to leave behind for your loved ones and could also affect your eligibility for means-tested benefits. In order to have maximum benefit from a lifetime mortgage for inheritance tax (IHT) your estate needs to be more than the sum of the NRB and RNRB.

It is essential to assess your overall financial situation to decide whether equity release is the right fit, or if there are more appropriate alternatives available.

Advice on planning for retirement and managing pensions

Pension planning is another key area where financial advice can make a substantial difference. For many, pensions represent the most significant savings pot outside of property, yet they are often misunderstood or neglected. As retirement approaches, knowing how to draw down your pension in the most tax-efficient way becomes increasingly important.

There are several options available when accessing your pension, including taking a tax free lump sum, setting up drawdown arrangements, or purchasing an annuity. Each comes with its own set of implications for tax, investment performance, and long-term income security. Without clear guidance, it’s easy to make choices that could result in paying more tax than necessary or even running out of money later in life.

Financial advice is particularly important when consolidating multiple pensions, especially if you are considering transferring your defined benefit schemes to a drawdown arrangement or the current scheme provides guaranteed income features such a Guaranteed Minimum Pension (GMP) benefit. It’s vital to evaluate the advantages and disadvantages of consolidation and help you build a sustainable income plan for your retirement years.

Advice on understanding the value of cash in retirement

In retirement planning, maintaining a cash reserve is crucial to safeguard your financial future, especially when facing market volatility. This strategy helps manage ‘sequencing risk’.

Sequencing risk is the risk of receiving lower or negative returns early on in your retirement due to market downturns when you begin drawing an income from your investments. The negative impacts of sequencing risk can have the effect of eroding your savings at a faster rate and can potentially increase the chances of running out of money.   
Holding a cash reserve equivalent to one to three years' worth of living expenses provides a buffer during market downturns. Instead of selling investments at a loss, you can draw from your cash reserves, allowing your investment portfolio time to recover. This approach helps preserve the longevity of your retirement savings.

Making the most of what you have

Life is full of financial crossroads - some expected, others less so. Selling a business, receiving an inheritance, going through a divorce, or receiving a medical diagnosis can all bring sudden and significant changes. In times like these, a financial adviser can act as both a guide and a steady hand, helping you navigate uncertainty with confidence.

Even if you’re not facing a major life event, periodic check-ins with a financial adviser can help ensure you remain on track toward your goals. Whether you're planning for retirement, helping your children financially, or simply looking to make smarter investment decisions, the right advice can help you make the most of what you have.

At its core, financial planning is not just about numbers. It’s about peace of mind, protecting your loved ones, and creating the future you want to see. For the decisions that matter most, getting expert advice can be one of the most valuable investments you make.

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

Levels, bases and reliefs from taxation may be subject to change.

Using equity on your home will affect the amount you are able to leave as an inheritance. Any means tested state benefits (both current and future) may be affected by any equity released. This is a lifetime mortgage. To understand the features and risks, ask for a personalised illustration.

A pension is a long-term investment. The fund value may fluctuate and can go down. Your eventual income may depend on the size of the fund at retirement, future interest rates and tax legislation.

The Financial Conduct Authority (FCA) do not regulate estate, cash flow planning, will writing or tax and trust advice.

When it comes to preparing for retirement, your pension is likely to be one of the most valuable financial assets you have. Yet, despite its importance, many people make costly errors when managing their pension savings -mistakes that can have lasting consequences on their financial wellbeing in later life. With increasing responsibility placed on individuals to navigate complex pension rules, it’s more important than ever to make informed decisions.

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1. Not saving enough during your working life 

One of the most common missteps is not saving enough in the first place. While auto-enrolment has brought millions of UK workers into workplace pensions, many contribute only the minimum amount required. Typically, this is 8% of your qualifying earnings split between employer and employee, but this may not be enough to fund the kind of retirement you’re hoping for.

A comfortable retirement often requires more than the minimum, and yet many workers never increase their contributions, even when their circumstances improve. Delaying pension saving or pausing contributions, even for a short period, can also have a disproportionately large effect on your final pension pot due to the compounding effect of long-term investment returns.

2. Consolidating without checking the small print

Pension consolidation itself can be both a solution and a problem, depending on how it’s done. Bringing together multiple pots can help you keep track of your savings and possibly reduce overall charges. However, some older pensions may come with valuable benefits, such as guaranteed annuity rates or protected tax-free cash, which can be lost if transferred. It's essential to understand what you're giving up before making any decisions.

3. Ignoring the impact of charges

Overlooking the impact of charges is another critical mistake. Charges on pensions might seem small, but over time they can eat away at your savings. Workplace pensions tend to have lower fees, often under 0.5% annually, due to charge caps on default funds. However, those who decide to transfer their pension into a Self-Invested Personal Pension (SIPP) or another non-workplace scheme may end up paying much more, sometimes more than 1% per year in management fees.

While these products can offer more control and investment choice, the higher costs can reduce your returns significantly. Before consolidating or transferring pensions, it’s important to weigh the benefits of simplicity and potential performance against the cost of higher fees.

4. Accessing your pension too early

Another pitfall is accessing your pension too early. While pension freedoms introduced in 2015 give you more flexibility, just because you can access your pension from age 55 (rising to 57 in 2028), it doesn’t mean you should. Many are tempted to dip into their pension pot to fund large purchases, help children financially, or simply to enjoy a bit of financial freedom.

However, withdrawing money early means missing out on years of potential investment growth and compounding, which can significantly reduce the size of your eventual retirement fund. Moreover, accessing your pension too soon could result in a pension pot that doesn’t last as long as you do, leading to financial insecurity in your later years.

5. Paying unnecessary tax on withdrawals

Tax is another area where pension savers often get it wrong. Taking large lump sums in one go can inadvertently push you into a higher income tax bracket. For instance, only the first 25% of your pension withdrawal is tax-free, subject to protection and the lump sum allowance (LSA). The rest is treated as taxable income and added to your annual earnings, which can quickly lead to a higher rate of tax being applied.

Many people fall into the trap of taking more than they need, unaware of the tax implications. Others may not realise that once they start drawing income from a defined contribution pension, their annual allowance for further tax-relieved contributions drops from £60,000 to just £10,000 under the Money Purchase Annual Allowance (assumes they were not already subject to tapering). This can be a nasty surprise for those who continue to work or return to employment and wish to keep contributing.

6. Using your pension as a rainy-day fund

There’s also the risk of relying too heavily on your pension to cover all future expenses. While it’s true that pensions offer favourable tax treatment and most can currently be passed on free of inheritance tax (although this is due to change from 2027), they shouldn’t always be your first port of call when you need money. Using other savings or investments first could give your pension more time to grow and preserve its value for the long term.

7. Not enjoying the fruits of your labour 

The fear of running out of money in retirement can hold you back from enjoying the fruits of your labour. It’s by far the most common concern, worrying if you’ve enough money to see you through your retirement years. From paying your household bills and maintaining the lifestyle you want, to being able to afford the potential one-off larger expenses such as cars, home repairs or holidays.

The key to peace of mind and a stress-free retirement, is planning. Planning allows you to spend the money you have saved without fear that you’ll run out. Knowing how long your money will last and how much you can afford to spend is vital. That switch from using income to build capital to using capital to provide income can be daunting.

It’s essential to make sure you plan as early as you can, to forecast if the money and assets you have set aside for your retirement will be enough to see you through.  At TPO we use a tool called Cash Flow Forecasting. It gives you control over your finances so you can live comfortably now, be prepared for unexpected expenses, or changes in circumstances and still have a secure future to look forward to.

Why financial advice is worth considering

In an increasingly complex pension landscape, the temptation to make quick decisions - whether it’s to access funds, switch providers, or pause contributions, is understandable. But these decisions can be hard to reverse and may come with long-term consequences. Many people find themselves navigating these choices without a clear understanding of the rules, which can result in missed opportunities or unnecessary losses.

This is where financial advice can be invaluable. A regulated financial adviser can help you understand your options, avoid common mistakes, and build a retirement strategy that suits your personal circumstances and long-term goals. While there may be a cost to getting advice, it can more than pay for itself by helping you avoid the pitfalls that erode your pension over time.

Pensions are too important to leave to chance. By taking the time to plan carefully, staying informed about your options, and seeking advice where needed, you can avoid these common mistakes and give yourself the best possible chance of enjoying a financially secure and fulfilling retirement.

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The information in this article is based on current laws, taxation and regulations which are subject to change as at future legislations.

This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

A pension is a long-term investment. The fund value may fluctuate and can go down. Your eventual income may depend on the size of the fund at retirement, future interest rates and tax legislation.

The Financial Conduct Authority (FCA) do not regulate estate or cash flow planning, or tax advice.

A good pension pot will look after you throughout your retirement. But what is a good pension pot – how much money will you need to rely on once you’ve retired, and how do you know how much to put in? More to the point, what is the average UK pension pot?

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What does a good pension pot look like?

There’s no straight answer to the question of what a good pension pot looks like, as there are a number of different factors to take into account. For example, variables include your age, when you’re hoping to retire, the type of pension you have, and the amount of money you’re expecting to live on once you’ve stopped working.

If you have a defined contribution pension, which is the most common type of pension in the UK, your pension’s value once you’re retired depends on what you’ve paid into it, any fees taken by your provider, and how your investments have performed.

What is the average UK pension pot?

According to the Financial Conduct Authority (FCA), the average pension pot for those aged 55 and over was around £107,300 as of 2022, although this varies widely by age group and region. However, this figure does not include the value of defined benefit pensions or the State Pension.

The Pensions and Lifetime Savings Association (PLSA) has also published Retirement Living Standards to help people gauge how much they might need, depending on the lifestyle they want. For a ‘moderate’ retirement lifestyle, the PLSA suggests a single person would need around £31,300 per year, which includes the State Pension. For a ‘comfortable’ retirement, which includes a little more luxury, a single person would need around £43,100 according to the report.   This would require a private pension pot of around £544,000 and £898,000 respectively, assuming retirement at age 65, full state pension with growth rate of 4% pa and 2% inflation each year, until age 100.

How much to put into your pension pot?

It can be tricky to know how much to put into your pension pot when deciding what sort of contributions to make. This is perhaps the main thing to consider, but it’s also important to think about how much you’ve got in there already and what other sources of income you’re expecting post-retirement. It’s often recommended to put about 15% of your income – pre-tax – into your pension every year while you’re working, but that might not always be possible.

Find out how much is in your pension pot at present – if you’ve got old pension pots from previous workplaces, you can track them down. If you have a financial adviser, speak to them about the merits of combining your pension pots, also known as pension consolidation. At this point, your pension provider should be able to provide you a simple projection of what your pension pot may be at the age you selected you wish to retire. As their projections are based on limited assumptions and are not personalised, you might also want to get an independent forecast from a financial adviser, like our pension specialists.

Once you’ve got a projection, you can discuss your situation with your adviser, who will be able to let you know whether your pension pot size will meet your retirement needs. If not, they can help you decide on how to increase your monthly contributions at a sensible rate.

Retirement Calculator

A useful tool to get a basic understanding of this is our retirement calculator. From your own inputs, you will be able to forecast an estimate of the pension income you will get when you retire and receive a target retirement income to aim for based on your choices. 

Am I saving enough into my pension?

Consider your preferred annual income in retirement, and any other guaranteed sources of income in retirement you may have, such as a state pension. Subtract your guaranteed income from your preferred income, and you’ll see how much you’ll need to make from other sources – including your pension pot. Through your workplace, you may have a final salary or defined benefit pension – these types of pensions can provide you with a guaranteed income for the rest of your life, and you can add it to your projected state pension to see how much you could earn when you’re retired.

If you’re not sure how much income you’ll need once you’re retired, you can make a few calculations to get a rough idea. Just start with your monthly expenditure at present, and then subtract regular costs that might not apply post-retirement; will you still be paying off your mortgage by then, for example? Then subtract other costs – if you’ve currently got dependent children who will be adults by the time you retire, consider how much you’d save as a result. Then, consider other savings you might be able to make, such as taking holidays during term time, and you should have a rough idea.

You might also need some extra money in retirement, whether that’s for treating yourself to luxuries you didn’t have time for while working, medical expenses and care costs as you get older, or helping your grandchildren through university or buying their first home. When saving, it’s best to include a safety margin, rather than just going for the bare minimum.

One last thing to consider is how long your retirement might be. People retire at different ages – and if you retire later, you might not need to save as much, despite potentially being able to save more. If you’re unsure, use 65 as the baseline. Then, estimate how long you might live – you can use a life expectancy calculator for this. According to the Office for National Statistics (ONS), life expectancy at age 65 is now around 19.8 years for men and 22.5 years for women in the UK, based on 2023 data. Of course, this also depends on your lifestyle and health.

What is the 50 – 70 rule?

The 50 – 70 rule is a quick estimate of how much you could spend during your retirement. It suggests that you should aim for an annual income that is between 50% and 70% of your working income.

In other words, if you are earning £100,000 then in retirement you will want to achieve somewhere between £50,000 and £70,000.

This rule should not be relied on as in-depth retirement planning, rather it is the first step in calculating and deciding upon what your ideal retirement expenditure should be. Realistically you will want to look at your employed income and expenditure and then think about what will change in retirement, for instance will you spend less money as you stop commuting? Or more money on holidays? This should then help you to have a more precise and robust expenditure plan for your retirement.

How to check my pension pot

It pays to check your pension pot size on a fairly regular basis, so that you can ensure you’re on track to meet your retirement needs. If there’s an issue, but you spot it earlier, you should be able to fix it with less difficulty.

First of all, it makes sense to request a State Pension statement – you can do so online, over the phone, or by post, as long as you’re aged over 16 and are more than 30 days away from your State Pension age. Then, if you belong to a defined benefit or final salary pension, your provider will usually send over a benefit statement each year, but you can ask for one if you need to. On the statement, you’ll be able to see how much you’re likely to receive with options surrounding whether or not you take some tax free cash. With regards to any defined contribution pensions you have, your annual statements will give you an idea of your future pot value, and the expected retirement income you’re thought to be in line to receive once you retire assuming you purchase an annuity. 

It’s worth bearing in mind that you might have other sources of retirement income too, be they investments or savings. These could include a property that you rent out, share-based investments, or cash deposits, and you may be able to get statements for these, too.

Saving for retirement can be stressful, and it’s not always easy to know how much money to put aside while you’ve got immediate expenses to consider. If you’re uncertain about whether you’re on track or simply want reassurance that your plans are realistic, a conversation with a financial adviser can be invaluable. Get in touch with The Private Office for a free initial consultation with one of our financial advisers.

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

Investments and the income derived from them can fall as well as rise and you may get back less than you originally invested. Past performance is not a guide to future returns.

The Financial Conduct Authority (FCA) does not regulate cash flow planning, estate planning, tax or trust advice.

The information in this article is based on current laws and regulations which are subject to change as at future legislations.

A pension is a long-term investment. The value of an investment and the income from it could go down as well as up. The return at the end of the investment period is not guaranteed and you may get back less than you originally invested.

It’s been a turbulent time for global markets, with headlines dominated once again by political uncertainty in the United States. As Donald Trump edged back into the spotlight, the resulting volatility in global markets created concern for investors everywhere, including those with UK pensions, and this concern shows little sign of abating anytime soon.

While what happens in US politics may seem far removed from your pension pot, global markets are of course interconnected. A shake-up in the US with the war on tariffs, whether economic or political, has rippled across global stock markets, including those that your pension may be invested in. It’s little wonder that those who are retired, nearing retirement, or even still building a retirement savings pot, are concerned, so it's worth understanding what market volatility could mean for you and what you can do to protect your long-term financial stability.

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For those recently retired: keeping your drawdown plan sustainable

If you’ve retired in the past five years and are relying on drawdown of your pension to provide income, stock market turbulence could present real challenges. When investment values fall and you’re withdrawing from your pension at the same time, you may be forced to sell more units to generate the same level of income. This can quickly erode the long-term sustainability of your pension fund, particularly if markets take time to recover.

One of the most practical ways to guard against this is to ensure you have a cash buffer in place. Rather than drawing from your pension when markets are down, using cash savings to cover income needs can help protect the value of your pension and give your investments time to recover. This is known as sequencing risk.  We generally recommend clients hold between three to five years’ worth of “uncovered expenditure” in cash. This refers to the gap between your annual spending and any secure income you may receive from sources like the State Pension or annuities. Having this buffer not only preserves your pension during downturns but also gives you peace of mind and flexibility in uncertain times.

For those on the cusp of retirement: review, don’t react

If you're planning to retire in the next year or so, recent market instability can be especially unsettling. You might be questioning whether your savings will stretch far enough or even wondering if you need to delay your retirement. These concerns are completely valid, but the most important thing to avoid is making knee-jerk decisions based on short-term market moves.

Rather than reacting emotionally, take this opportunity to review your retirement plan. Assess whether your goals remain achievable given the current market backdrop. We use cashflow modelling to help clients understand how their financial future might look under different economic scenarios. This kind of planning is useful not only during turbulent periods, but also when other life circumstances change, such as spending needs or health considerations.

Continuing to contribute to your pension, if possible, remains a smart move. Despite market dips, pensions are still one of the most tax-efficient ways to save. Higher-rate taxpayers, for example, benefit significantly from tax relief, which helps boost long-term returns. Ongoing contributions also allow you to benefit from pound-cost averaging, helping you buy investments at lower prices when markets fall. Over time, this can enhance the overall value of your pension pot.

It’s also a good idea to review your pension’s investment strategy to ensure it aligns with your changing timeline and appetite for risk. For some, this may mean reducing exposure to riskier assets. For others, especially those with longer-term plans, staying invested in growth assets may still make sense. Either way, professional financial advice can help clarify your options and ensure any changes are based on sound financial reasoning, not short-term fear.

For those around 10 years away: stay focused on the long game

If you’re still a decade or more away from retirement, your pension remains in the accumulation phase, and time is very much on your side. While short-term market downturns can feel unnerving, they’re less likely to have a lasting impact on your long-term retirement goals. The key message for this group is simple: avoid panicking and stay invested.

That said, now is a good time to check the specifics of how your pension is managed, especially if you’re in a lifestyle fund. These funds typically begin to switch from equities to lower-risk assets like bonds in the 10 to 15 years before your target retirement date. While the principle is sound, the automatic nature of this switching process can be problematic if it coincides with a market dip. You could end up selling equities at a loss – not because it’s the right financial decision, but because that’s how the fund is structured.

Understanding when your lifestyle fund begins this transition, and whether the retirement age it targets aligns with your actual retirement plans, is essential. If there’s a mismatch, it may be time to take control and ensure the fund’s timeline matches your own. The same goes for those using Self-Invested Personal Pensions (Sipps), where greater flexibility means greater responsibility. Now could be a good time to reassess your asset mix and make sure it remains appropriate for your long-term goals.

Even though this group is less immediately exposed to market volatility, making the right decisions now can make a big difference in the future. Whether it’s tweaking your investment strategy, increasing contributions, or just ensuring your retirement date is correctly reflected in your fund choices, these actions can help keep your pension on track.

Why advice matters more than ever

Political and economic uncertainty is nothing new, but periods of heightened instability, such as the one we’re currently witnessing, highlight just how important it is to have a robust financial plan in place. Regardless of where you are on your retirement journey, taking a step back to review your situation, rather than rushing into changes, is key.

For many, the support of a professional financial planner can make all the difference. We can help you assess your position, model different retirement outcomes, and ensure you’re making informed decisions that protect and grow your wealth over time. At a time when the headlines can feel overwhelming, having expert guidance tailored to your circumstances can provide much-needed clarity and confidence.

If you’re unsure how recent market movements might affect your retirement plans, or if you simply want to make sure you’re on the right path, now may be the ideal time to get in touch.

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions. 

A pension is a long-term investment not normally accessible until age 55 (57 from April 2028 unless the plan has a protected pension age). The value of your investments (and any income from them) can go down as well as up which would have an impact on the level of pension benefits available.  Your pension income could also be affected by the interest rates at the time you take your benefits

Past performance is not a guide to future returns.

The Financial Conduct Authority (FCA) does not regulate tax advice and cashflow modelling.

The Chancellor previously confirmed that she only wanted to make major tax and spending announcements once a year, with this being in the Autumn Budget.  Therefore, no tax changes were expected and none were delivered.

The headline from the speech was that the Office for Budget Responsibility (OBR) has halved its 2025 growth estimate for the UK from 2% to 1% in 2025, but it has upgraded its longer term forecasts from 2026 onwards.

Alongside this, previously announced cuts to Welfare and Overseas Aid payments, Increases in Defence spending and Planning Reforms were confirmed.

In terms of signposting future changes that could be announced:

• The government confirmed it is looking at options to reform ISAs to “get the balance right between cash and equities to earn better returns for savers” which could indicate limited cash ISA allowances relative to Stocks and Shares ISA allowances.
• The government will also be holding a series of roundtables with key stakeholders over April as it considers the role of tax reliefs for Enterprise Management Incentives Schemes, Enterprise Investment Schemes and Venture Capital Trusts.

After the pension changes over the last few years and, in particular, last year’s confusion as the new pension rules were ‘bedded in’ and legislation adjusted, it was a relief to have no further tinkering with pension rules.

We already know of course, of various areas of impending change, including the removal of the ‘domicile’ tax regime from 6 April this year, the Business Property Relief and Agricultural Property Relief changes from April 2026 and of course the Pensions and IHT changes from April 2027 – which we await further details on.

These areas and others, including the employer National Insurance increases, are covered off in our Autumn Statement 2024 summary.

There were some changes announced to Universal Credit from 2026 onwards and from this summer it will become possible for those newly liable for the High Income Child Benefit Charge to pay the tax through PAYE rather than via self-assessment.

If you’d like to discuss any of the announcements from the Spring Statement or Autumn Budget last October, and are concerned about how they will affect your financial plan, why not get in touch and speak to one of our expert advisers.

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

The Financial Conduct Authority (FCA) does not regulate tax advice.

Planning for retirement requires careful consideration of the best savings vehicles available, and two of the most popular options in the UK are pensions and ISAs (Individual Savings Accounts). While both offer tax-efficient ways to grow wealth, they serve different purposes and come with distinct advantages and limitations. A well-rounded retirement strategy may involve using both, depending on individual financial goals, tax considerations, and evolving regulations.

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The role of pensions in retirement planning

Pensions are designed primarily for long-term retirement savings, offering significant tax advantages that make them an attractive option. One of the biggest benefits is the tax relief on contributions—money paid into a pension receives tax relief at an individual’s marginal tax rate, effectively reducing the amount of tax paid on earnings. For higher or additional-rate taxpayers, this makes pensions particularly valuable, as contributions can benefit from 40% or even 45% tax relief, depending on income levels.

Additionally, pensions provide tax-free investment growth, allowing savings to accumulate over time without being eroded by capital gains tax or dividend tax. When it comes to withdrawing funds, 25% of a pension pot can be taken as a tax-free lump sum, while the remaining balance is subject to income tax. The trade-off for these benefits is that pension savings are locked in until at least age 55 (rising to 57 in 2028), making them less accessible in comparison to ISAs.

The flexibility of ISAs

ISAs, on the other hand, offer tax-free growth and withdrawals, making them an excellent complement to pensions in a retirement strategy. While contributions do not receive tax relief, the ability to access funds at any time without penalty makes ISAs more versatile. This flexibility can be particularly useful for those who may need to draw on savings before retirement or wish to supplement their pension income without triggering additional tax liabilities. ISAs have a limit of £20,000 per individual per tax year and this can be split across cash and/or stocks and shares.

Cash ISAs allow savers to earn tax-free interest, while Stocks & Shares ISAs provide the potential for investment growth with no capital gains or dividend tax on returns. This makes ISAs an attractive choice for those who want to retain control over their savings without the restrictions of a pension. However, recent discussions about potential changes to the Cash ISA framework have raised concerns about its long-term benefits, making it all the more important for savers to stay informed about policy updates.

The changing landscape of pensions and inheritance tax

One of the most significant changes being proposed for pensions  is the planned inclusion of pension funds within the scope of inheritance tax (IHT) from 2027. Historically, pensions have been an efficient way to pass wealth down to future generations, as they have typically fallen outside of an individual’s estate for IHT purposes. This has led many financial advisers to recommend using non-pension savings first in retirement, preserving pension wealth to be inherited tax-free.

However, with the proposed new rule changes, pensions may no longer enjoy this exemption, potentially making them less favourable for wealth transfer. This shift may encourage retirees to draw down on their pensions earlier rather than leaving them untouched, making strategic planning even more essential. Individuals should review their estate planning strategies in light of these proposed changes to ensure they optimise tax efficiency while securing their financial future.

Balancing pensions and ISAs for a stronger retirement plan

Given the unique advantages of both pensions and ISAs, a balanced approach can help individuals make the most of their retirement savings. Pensions remain a powerful tool for long-term wealth accumulation due to tax relief and employer contributions, but they have some limitations on access and flexibility and could soon be subject to inheritance tax. ISAs, while not offering tax relief on contributions, provide tax-free growth and withdrawals, making them an excellent complement for early or flexible access to savings – but are limited to £20,000 contribution per tax year.

Younger savers may prioritise pensions to take full advantage of employer contributions and tax relief, ensuring they build a solid foundation for the future. Meanwhile, those approaching retirement may benefit from shifting some focus to ISAs, allowing for accessible savings that can be drawn upon without incurring additional tax burdens. Given the proposed changes to pension inheritance tax, retirees may also need to rethink how they draw down their savings, potentially using pensions earlier than previously advised.

With tax laws and regulations evolving, seeking professional financial advice is crucial to navigating the complexities of retirement planning. A tailored strategy that considers tax efficiency, investment growth, attitude to risk, and changing policies can make a significant difference in long-term financial security. By carefully balancing contributions between pensions and ISAs, individuals can build a more resilient retirement portfolio that aligns with their goals and adapts to the shifting financial landscape.

We’re currently offering anyone with £100,000 or more in pensions, savings or investments  a free initial financial review worth £500. If you’d like to learn more, get in touch for an initial consultation to see how we can help.

Arrange your free initial consultation

This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions. 

The Financial Conduct Authority (FCA) does not regulate tax planning.

Investment returns are not guaranteed, and you may get back less than you originally invested. Past performance is not a guide to future returns.

The information contained within this article is based on our understanding of legislation, whether proposed or in force, and market practice at the time of writing. Levels, bases and reliefs from taxation may be subject to change.

Who deals with the finances in your household? Would your family know where to look should something happen to you?

In the past, having a will would be how your final wishes were granted for the distribution of your assets after death…

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But is it enough in the new digital world?  

As the financial industry transitions towards increasingly using technology, your loved ones are unlikely to unearth your financial information by searching through a physical filing cabinet. Finder, a global fintech, estimates that in the UK alone, 47 million people use some form of online or remote banking – that’s 87%!  In the last decade especially, each of our digital footprints has grown exponentially. With multiple logins, passwords, usernames and accounts held across different websites and portals it’s hard to keep track yourself. The question is, how would your loved ones cope with this should you pass away?

No one can dispute that navigating the death of a loved one is one of life’s biggest challenges. To further complicate things, a recent survey by consumer group Which? has indicated that 76% of members surveyed had left no plan for what to do with their digital assets should they die.

Removing the additional complexity of trying to locate relevant documents to settle your estate can only be of benefit to those you leave behind. Although you can name a ‘digital executor’ in your will, this does not extend to consolidation of your financial affairs into one accessible place. TPO Wealth solves this problem for you.

What is TPO Wealth?

At The Private Office, all our clients have access to a digital filing cabinet, at no additional cost, through our secure online portal TPO Wealth. As with a physical filing cabinet, here documents can be stored safely and securely. By leaving behind instructions for family members on how to access this, the painful process of settling your estate can be expediated and enhanced.

With your consent, your solicitors and accountants can also access information you deem appropriate, such as tax returns. This capability allows for a seamless and effortless experience for you. You can have confidence that your information is safe, whilst allowing trusted contacts to have access to relevant documents.

Our clients use TPO Wealth to file personal financial documents and those they choose to share with professional contacts, such as their:  

• Tax Information 
• Will 
• Invoices 
• Details of professional contacts 
• In case of emergency details 

This can be particularly useful for the self-employed. As of October 2024, the statistical agency Statista estimates that 4,383,000 people in the UK are self-employed. That’s 13.1% of the workforce! Granting your accountant access to secure documents on TPO Wealth could substantially speed up the arduous process of filing tax returns and completing annual accounts.

With all the information neatly stored in one place, the need for time consuming back-and-forth is reduced. You’re free to get on with life’s more important things.

What about if you become incapacitated? 

Beside from the death of a loved one, information may be required, in other instances. Consider critical illness or incapacity. Should something happen to you, access to your TPO Wealth account and those within the remit of your Power of Attorney rights can be granted. Ministry of Justice data from 2024 indicates just how slow the Lasting Power of Attorney process can be – in fact, one application was finally processed in 2024 after a total of 2,777 working days!  

Would you like to take control of your finances?

Beyond secured storage of important files, with TPO Wealth you can track investment performance and the growth of your savings, across various accounts with different providers, all in one place. Using clear graphics, our clients can track the value of their net-worth in real time. Features such as an in-built property value calculator contribute towards overall peace of mind, as you can get a clear picture of the state of your finances, all at your fingertips.

If you’d like to learn more about how TPO Wealth can help to consolidate your financial affairs into one simple, easy-to-use place, we would be happy to help.

So why not get in touch?

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions. 

TPO Wealth is only available to clients of The Private Office.

The Financial Conduct Authority (FCA) does not regulate estate planning or tax advice. 

According to studies by the Financial Conduct Authority, there is a staggering number of people in the UK who do not seek financial advice. This is known as ‘The Advice Gap’ and the number has been put at 39 million.

As an adviser with nearly 40 years in the business it does not necessarily surprise me that there is a great deal of reluctance. Much of the UK’s wealth resides with the Baby Boomers, many of whom can remember what financial advice used to be like in the 70s and 80s. The high levels of professionalism which exist in the industry today, were a thing of the future. Even as late as the mid 80s (when there was no regulation) one insurance company rep (I will desist from mentioning any names) cited that in his first job (in Swansea) one of his best producing ‘advisers’ was a butcher who also sold life insurance policies to his customers, presumably in conjunction with two pounds of mince!

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I have witnessed the complete transformation of this industry. The advisers of today are well educated and highly qualified people with, perhaps most importantly, a high degree of integrity. There is no resemblance to the ‘wild west’ of old but, of course, I have sympathy for any individuals (and there are many) who had a bad experience in the past.

But baby boomers with unhappy memories aside, there is still a great deal of misunderstanding about the value an adviser can add.

In 2022 the Financial Conduct Authority (FCA) conducted research and found that 60% of people with investable assets of £10,000 or more considered that they wouldn’t benefit from financial advice. Another survey by the Financial Services Compensation Scheme (FSCS) indicated that 23% of people felt they didn’t have sufficient wealth to warrant advice and 38% considered advice to be too costly and didn’t represent value for money.

What does value for money represent?

In stark terms this can be viewed as asking the simple question “would I have more money at the end of the day with or without and adviser?” and this is a fair question. Most ‘sceptics’ will simply look at portfolio returns only. Of course, performance returns are very important but in the context of holistic financial advice, it is only one factor.  

This point can be illustrated well by an experience I had with a client I had just acquired back in 2017, who was drawing down money from a pension and paying 40% tax for the privilege. The same client had considerable wealth held outside of the pension and by running cashflow projections, I was able to demonstrate that by directing the income away from the pension and taking it from pension investments, at the end of his life (assumed to be the life expectancy given his age) his estate would be over £300,000 better off. This was simply a tax observation and had nothing to do with the performance of underlying portfolios.

We would all be great investors if we had a crystal ball!

On the subject of portfolios there is also a tendency for would be clients to look at performance in the rear mirror and conclude that self-investing would result in a higher net return. We would all be great investors if we had a crystal ball! The most common trait of the amateur investor, particularly when markets are doing well, is to increase the risk of the portfolio and then, when a market crash comes, all of a sudden, those high performing investments are often the first to fall off a cliff.  

One of the responsibilities of a good adviser is not only to ensure that your money grows well but to ensure than when times are tough, you are sufficiently protected. This is particularly true for retired clients who are in the ‘decumulation’ stage, the point at which you start to draw on your retirement funds. They have worked hard all their lives to build up a pot for retirement and it must be structured in such a way that, if there is a market crash (and there will be one sooner or later), they can continue to draw an income without losing sleep. This can only be done by managing the overall risk and making sure there is sufficient ‘low risk’ investment in the short term to ride the market turmoils.

How to quantify the Value of Financial Advice

In 2019 the International Longevity Centre (ILC) conducted a survey to quantify the value of advice in monetary terms. Over the course of a 10-year period, on average, those who sought advice saw their wealth increase by a whopping £47,706, twenty-four times higher than the average initial fee for the advice.

It is not only the hard benefit of pounds and pence. A Royal London study examined the emotional benefits of having a trusted adviser on board. Peace of mind scored highly. Most people want to enjoy their lives without feeling anxious about their finances. 

A good financial adviser can often provide reassurance, particularly if a projection of finances (using cashflow tools based on cautious assumptions) indicates that life goals can be achieved.

Achieving one’s goals is like climbing a mountain. It takes preparation, equipment, skill and determination to get there, and I don’t know about you, but if I were taking on Everest, I’d rather do it with a good sherpa by my side!

Ultimately, it hinges on trust, and the industry has created a landscape populated by well-equipped advisers who are highly regulated, and duty bound to work in the clients’ best interests. According to the Langcat Report 91% of people considered their advice to be helpful and valuable.  

Some readers will be old enough to remember Red Adair. A colourful character, Red was the only person in the world capable of extinguishing raging fires on oil rigs (an alarmingly regular occurrence back in the 70s). He also charged accordingly and when challenged on his fees he replied “If you think it’s expensive hiring a professional, you should try hiring an amateur!”.

If you would like to learn more about how we can help, why not get in touch and speak to one of our qualified advisers for a free initial consultation.

Arrange your free initial consultation

This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

Investment returns are not guaranteed, and you may get back less than you originally invested. Past performance is not a guide to future returns.

The Financial Conduct Authority (FCA) does not regulate cash flow planning, estate planning, tax or trust advice.

In one of the longest ‘Budget’ speeches in memory, Chancellor Rachel Reeves gave the first Labour Budget speech for nearly 15 years on 30 October 2024.  

Here we’ve summarised the main elements of interest for financial planning, with further details on tax rates and allowances for 2025/26 (to compare to 2024/25) available on the government website.  

If you have any concerns or questions about any of the announcements and would like to speak to one of our expert financial advisers, contact us for a free initial consultation to see how we can help.

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Non- domicile changes

The non-domicile tax regime is to be abolished from 6 April 2025. Domicile will no longer be a feature of the UK tax system and will be replaced by a system based on residency.

The government will:  

• Introduce a new 4-year foreign income and gains regime for new arrivals who have not been UK tax resident in the previous 10 years
• Allow individuals previously taxed on the remittance basis to remit pre-6 April 2025 foreign income and gains using a new Temporary Repatriation Facility
• Reform Overseas Workday Relief
• Replace the domicile-based system for inheritance tax with a residence-based system

VAT on private school fees

From January 2025, 20% VAT will apply to private school fees across the UK and the business rates charitable rates relief for private schools in England will be removed.

Income tax and personal National Insurance (NI)

Income tax bands and personal NI thresholds remain frozen until April 2028. This time period hasn’t been extended and from 2028/29 these bands/thresholds will increase with inflation.

Capital gains tax (CGT) changes

Investors’ Relief

Investors’ Relief (IR) provides for a lower rate of CGT to be paid on the disposal of ordinary shares in an unlisted trading company where certain criteria are met, subject to a lifetime limit of £10 million of qualifying gains for an individual.

This measure reduces the lifetime limit from £10 million to £1 million for IR qualifying disposals made on or after 30 October 2024.

CGT rates

The main rates of Capital Gains Tax (that apply to assets other than residential property and carried interest), will increase from 10%/20% to 18%/24% respectively for disposals made on or after 30 October 2024.

The main rate of Capital Gains Tax that applies to trustees and personal representatives will increase from 20% to 24% for disposals made on or after 30 October 2024.

The rate of Capital Gains Tax that applies to Business Asset Disposal Relief and Investors’ Relief is increasing to 14% for disposals made on or after 6 April 2025 and from 14% to 18% for disposals made on or after 6 April 2026.

Carried interest

Carried interest, which is a form of performance-related reward received by fund managers, primarily within the private equity industry, will be subject to a CGT rate of 32% from April 2025 (current rates are 18% and 28%). From April 2026, carried interest will be subject to a revised regime within the income tax framework.  

Inheritance tax (IHT) changes

Freezing of IHT thresholds

The Inheritance Tax thresholds were already fixed at their current levels until April 2028. This time period has been extended to April 2030. This measure will fix the:

• Nil-rate band at £325,000
• Residence nil-rate band at £175,000
• Residence nil-rate band taper, starting at £2 million

Inherited pensions

From 6 April 2027, when a pension scheme member dies with unused funds or without having accessed all of their pension entitlements, those unused funds and death benefits will be treated as being part of that person’s estate and may be liable to Inheritance Tax. The current distinction in treatment between discretionary and non-discretionary schemes will be removed.  

The change will apply to both DC and DB schemes. It will apply equally to UK registered schemes and QNUPS. This will ensure that most pension benefits are treated consistently for Inheritance Tax purposes, regardless of whether the scheme is discretionary or non-discretionary, DC or DB.  

A small number of specified pension benefits will remain outside scope for Inheritance Tax, including where funds can only be used to provide a dependants’ scheme pension. These are currently out of scope in non-discretionary schemes and so will remain out of scope under this change.  

Pension scheme administrators will become liable for reporting and paying any Inheritance Tax due on pensions to HMRC. This will require pension scheme administrators and personal representatives to share information with one another.  

A technical consultation has been issued on the processes required to implement these changes for UK-registered pension schemes. After the consultation, the government will publish a response document and carry out a technical consultation on draft legislation for these changes in 2025.

The government will continue to incentivise pension savings for their intended purpose of funding retirement, supported by ongoing tax reliefs on both contributions into pensions and on the growth of funds held within a pension scheme.  

Agricultural relief and business relief  

From 6 April 2025, the existing scope of agricultural relief will be extended to include land managed under an environmental agreement with, or on behalf of, the UK government, devolved governments, public bodies, local authorities, or relevant approved responsible bodies.  

From 6 April 2026, agricultural relief (AR) and business relief (BR) will be reformed, as summarised below:

• The 100% rate of relief will continue for the first £1 million of combined agricultural and business property to help protect family farms and businesses, and it will be 50% thereafter.  
• The rate of business relief will reduce from 100% to 50% in all circumstances for shares designated as “not listed” on the markets of recognised stock exchanges, such as AIM.  

The reforms are expected to only affect around 2,000 estates each year from 2026/27, with around 500 of these claiming agricultural relief and around 1,000 of these holding shares designated as “not listed” on the markets of recognised stock exchanges.  

The government will publish a technical consultation in early 2025. This will focus on the detailed application of the allowance to lifetime transfers into trusts and charges on trust property. This will inform the legislation to be included in a future Finance Bill.

More detail is available at gov.uk. 

National insurance

Employer NI is to increase to 15% (from 13.8%) from April 2025 and the secondary threshold will reduce to £5,000 (from the current £9,100), i.e. employer NI will become payable on an employee’s earnings above £5,000pa.

The Employment Allowance, a National Insurance exemption for smaller businesses, will increase to £10,500 (from £5,000).  

Pensions

Qualifying recognised overseas pension scheme (QROPS)

The Overseas Transfer Charge (OTC) is a 25% tax charge on transfers to QROPS, unless an exclusion from the charge applies.

The government has announced that they are removing the exclusion from the OTC for transfers made on or after 30 October 2024 to QROPS established in the EEA and Gibraltar.

Also, from 6 April 2025, the conditions of OPS and ROPS established in the EEA will be brought in line with OPS and ROPS established in the rest of the world, so that:  

• OPS established in the EEA will be required to be regulated by a regulator of pension schemes in that country
• ROPS established in the EEA must be established in a country or territory with which the UK has a double taxation agreement providing for the exchange of information, or a Tax Information Exchange Agreement

From 6 April 2026, scheme administrators of registered pension schemes must be UK resident.  

Aligning the treatment of transfers to QROPS established in the EEA and Gibraltar with that of transfers to QROPS established in the rest of the world will help to ensure that some UK residents do not benefit from a double tax-free allowance whilst remaining in the UK and reduces the risk of around £1 billion of UK tax-relieved pension savings being transferred overseas across the scorecard.

Changing the conditions EEA schemes need to meet in order to become an OPS or ROPS will mean that they will have to meet the same conditions as those which are established anywhere else in the world.

Requiring scheme administrators of registered pension schemes to be UK resident will mean that all administrators of registered schemes will need to meet the same conditions.    

Further details are available at gov.uk. 

Employee Ownership Trusts and Employee Benefit Trusts

Targeted reforms are to be made to the Employee Ownership Trust tax reliefs to ensure that the reliefs remain focused on the intended purpose of encouraging and supporting employee ownership, whilst preventing opportunities for the reliefs to be abused to obtain tax advantages outside of these intended purposes.

Details are available at gov.uk

Stamp Duty Land Tax (SDLT)

The higher rates of Stamp Duty Land Tax (SDLT) for purchases of additional dwellings (second properties) and for purchases by companies is increasing from 3% to 5% above the standard residential rates of SDLT.  

This measure also increases the single rate of SDLT payable by companies and other non-natural persons purchasing dwellings over £500,000, from 15% to 17%.  

Both changes apply to transactions with an effective date on or after 31 October 2024.  

National Minimum Wage

The National Living Wage will increase from £11.44 to £12.21 an hour from April 2025.  The National Minimum Wage for 18 to 20-year-olds will also rise from £8.60 to £10.00 an hour.

State benefit and state pension increases

From April 2025, a 4.1% increase to the basic and new State Pension meaning the full new State Pension will rise from £221.20 to £230.25 a week, while the full basic State Pension will increase from £169.50 to £176.45 per week.

The Pension Credit Standard Minimum Guarantee will increase by 4.1% from April 2025, meaning an annual increase of £465 in 2025/26 in the single pensioner guarantee and £710 in the couple guarantee.

Working-age state benefits and the Additional State Pension will rise by 1.7% in April 2025, in line with inflation.

Furnished holiday lettings (FHL)

As previously announced, the furnished holiday lettings (FHL) tax regime will be abolished from April 2025, removing the tax advantages that landlords who offer short-term holiday lets have over those who provide standard residential properties.

The current rules provide beneficial tax treatment for furnished holiday lettings compared to other property businesses in broadly four key areas:

• Exemption from finance cost restriction rules (which restrict loan interest to the basic rate of Income Tax for other landlords)
• More beneficial capital allowances rules
• Access to reliefs from taxes on chargeable gains for trading business assets
• Inclusion as relevant UK earnings when calculating maximum pension relief

The abolition of the FHL regime will mean that income and gains will then:

• Form part of the person’s UK or overseas property business
• Be treated in line with all other property income and gains

If you’d like to discuss any of the changes announced in the Autumn Budget or would simply like to explore ways that you can minimise the amount of tax you pay on your wealth, why not get in touch and speak to one of our expert team of advisers. We’re offering anyone with £100,000 in savings, investments or pensions a free financial review worth £500.

Arrange a free initial consultation

This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions. 

The Financial Conduct Authority (FCA) does not regulate cash flow planning, estate planning or tax. 

The information contained within this article is based on our understanding of legislation, whether proposed or in force, and market practice at the time of writing. Levels, bases and reliefs from taxation may be subject to change. 

Nearly 4 months after the general election, Chancellor Rachel Reeves finally delivered her eagerly anticipated Budget this afternoon.

It had been widely reported that there would be tax rises and speculation had been rife that pensions, capital gains tax and inheritance tax could be targeted to raise tax revenue following Labour’s manifesto commitment not to increase taxes on “working people”.

In the end, changes to all three of these areas were announced as Reeves looks to raise taxes by £40bn, though the changes were not to the extent that many had feared.

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Capital Gains Tax

The main rate of Capital Gains Tax will increase for basic rate tax payers from 10% to 18% and for higher rate tax payers from 20% to 24%. This change will take effect immediately. Capital Gains Tax on second properties will remain unchanged.

There had been rumours that capital gains tax rates would be equalised with income tax rates, so the changes could be viewed as relatively modest compared to potential increases of this level.

Pensions

Investors will have been pleased to see that no changes were announced to the maximum tax free cash that can be taken from pensions or the tax relief available on pension contributions. However, it was announced that unused pension funds and death benefits payable from a pension will be included in the value of estates for inheritance tax purposes from 6 April 2027. This will affect individuals who were previously planning to leave their pensions to beneficiaries rather than to spend them in their lifetimes, though income taken from pensions in excess of tax free cash entitlements is subject to income tax and will then form part of the estate for inheritance tax purposes if not spent, so careful planning will be needed to ensure funds are not taxed twice.

Inheritance Tax

Aside from inherited pensions entering the estate for inheritance tax purposes in 2027, there were a couple of additional changes to inheritance tax rules.

Firstly, the freezing of the nil rate band (£325,000) and Residence Nil Rate Band (£175,000) until 2030 was announced. For reference, the Residence Nil Rate Band is generally available when a main residence is passed to direct descendants and this, combined with the nil rate band, generally gives married couples £1m which can be passed to direct descendants inheritance tax free on the second death of them both.

Additionally, there had been rumours that the inheritance tax break on shares listed on the Alternative Investment Market (AIM), if held for two years before death, would be scrapped. However, the Chancellor instead took a ‘half way’ approach by introducing a 20% inheritance tax rate in respect of these shares.

The Chancellor also announced changes to two lesser-known inheritance tax reliefs, Business Relief and Agricultural Relief, which will now be subject to a 20% inheritance tax charge on qualifying asset values over £1 million.

Income Tax, Employee’s National Insurance and VAT

As expected there were no increases in these three areas given they affect “working people”. However, with income tax bandings already frozen until 2028, there was an expectation the Chancellor may extend this date, but this did not prove to be the case, as the Chancellor confirmed the freezing of these bandings would end in 2028.

Given the above changes were not to the level expected, how has the Chancellor raised £40bn?

Employer’s National Insurance

A large proportion of this £40bn (an estimated £25bn) will be funded by a large increase in employer’s National Insurance contributions from 13.8% to 15% and a reduction in the threshold from which these are paid from £9,100 to £5,000.

Stamp Duty on second properties

Landlords will be disappointed to see the stamp duty surcharge on second properties increasing from 3% to 5% with effect from 31 October.

Non-Dom tax status abolished

As expected, the Chancellor confirmed Labour’s plans to abolish “non-dom” tax status.

Overall, after weeks of speculation, the tax rises announced in the budget were not to the extent that many had feared. Individuals with pensions will be relieved to see no reduction in their maximum tax free cash entitlement and no change to the tax relief they can receive on pension contributions. Investors may also feel increases in capital gains tax rates could have been worse. Instead, businesses were left to fund the majority of the tax rises through their National Insurance contributions.

However, these changes to inheritance tax, pensions and capital gains tax rules will mean financial plans will need to be revisited. To discuss the implications of the budget for your personal financial situation, please contact your TPO Independent Financial Adviser.

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The Financial Conduct Authority (FCA) does not regulate estate planning or tax advice.

This article is intended as information only and does not constitute financial advice.  

The opinions shared in this article are solely those of the individual and they do not necessarily reflect those of The Private Office.

The information contained in this article is based on our understanding of legislation, whether proposed or in force, and market practice at the time of writing. Levels, bases and reliefs from taxation may be subject to change.