A hint of rising interest rates?

Interest rates are set to rise

The Bank of England has suggested that interest rates may rise sooner than expected. After its August meeting, the Bank of England (BoE) was never expected to announce any change in base rate from the 0.1% set in response to the pandemic. The BoE, like its counterparts in the US, Eurozone and Japan, wants to…

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No room for giveaways in OBR risk report

The Office for Budget Responsibility has warned the Chancellor will need £10bn to address Covid-19, climate change and government debt, not leaving much room for Budget giveaways.

The Office for Budget Responsibility (OBR) has given Rishi Sunak its new worry list. It gives the Chancellor little wriggle room for potential Budget generosity. Every alternate year the OBR must issue a Fiscal Risks Report (FRR). Unlike the six-monthly economic outlooks the OBR produces for Budgets and (theoretically) Spring Statements, the FRR takes a…

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Social care rises up the agenda

With social care funding climbing to the top of the agenda, potential additional means-tested personal contributions need to be included in retirement planning.

A proposal to address social care funding is apparently imminent.  “My job is to protect you or your parents or grandparents from the fear of having to sell your home to pay for the costs of care. And so I am announcing now – on the steps of Downing Street – that we will fix…

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National Savings to launches Green Savings Bond

National Savings has announced a new Green Savings Bond

National Savings & Investments has announced details of a new green savings product.  One of the small surprises in March’s Budget was the announcement that National Savings & Investments (NS&I) would be launching “a new, retail savings product to give all United Kingdom savers the chance to support green projects”. No further information was given at…

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HMRC loses on child benefit tax

A recent court case has case doubt over the way HMRC collects tax on child benefit

A recent Upper Tribunal case has raised questions about HMRC’s approach to collecting tax on child benefit.  Child benefit tax, or the High-Income Child Benefit Charge (HICBC) to use its legal name, has a chequered history. The HICBC was introduced in January 2013 as a mechanism for clawing back child benefit from high-income couples, whether…

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Pension lifetime allowance cuts are looming on the horizon

Rumoured cuts to the lifetime allowance for pensions could cause problems for those planning to retire soon

New HMRC statistics show the lifetime allowance continues to be a useful revenue earner for HM Treasury, but rumoured cuts could be a concern for soon-to-be retirees.  In the March Budget, the Chancellor announced that he would be freezing the pension lifetime allowance (LTA) at its 2020/21 level of £1.0731 million until the end of…

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The Triple Lock trip up, take two

There is a threat to the triple lock on state pensions

State pension increases and the Triple Lock are back in the spotlight. About a year ago, during the first wave of the pandemic, several think tanks started to look at the potential repercussions of the then crumbling economy on state pensions. Their particular focus was on the ‘Triple Lock’, which applies only to payments made…

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The £9 billion Child Trust Funds backwater

Child Trust Funds are largely forgotten

Over £9 billion was invested in Child Trust Funds (CTFs) as of April 2020, according to new HMRC data. If you have a child or grandchild born between 1 September 2002 and 2 January 2011, they were almost certainly the beneficiary of a government payment – either £250 or £500 – into a CTF. The…

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Cash ISAs remain dominant: The wrong type of ISA?

Cash ISAs are the dominant form of ISA saving

New statistics from HMRC show over £300bn invested in cash ISAs. One of the many knock-on effects of the pandemic has been that HMRC’s annual updating of statistics has suffered delays. As a result, details of ISA subscriptions and holdings for 2019/20 have only just emerged. Among many interesting facts, the data shows: Despite ultra-low…

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How much pension?? What is an adequate retirement income?

Planning your retirement income is not straightforward

A leading pension think tank has examined this question – but the findings aren’t straightforward. Over the years, there has been much focus on the tax treatment of pensions and ways to encourage greater saving for retirement. Arguably, there has been less attention paid to the question of how much income you will need once…

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