The recent Budget introduced significant tax changes that could impact your finances. With the new tax year just months away, it’s important to review your financial plans and take advantage of any tax saving opportunities before the end of the tax year.
Here’s some actions to consider:
Passing on your wealth
From April 2027 pensions will be brought into Inheritance Tax (IHT), which may significantly reduce the wealth you pass on. If you were relying on pensions as an IHT-efficient tool, consider reviewing your retirement and estate planning strategies.
Capital Gains Tax (CGT) changes
Capital Gains Tax has increased to 18% at the lower rate and 24% at the higher rate, aligning taxes on assets like shares, unit trusts and OEICs with residential property gains. This change enhances the value of using tax-efficient products like ISAs and pensions.
Maximise pension contributions
You can contribute up to £60,000 tax-free each year and carry forward unused allowances from three previous tax years. From age 55 you can also take up to 25% tax free. In addition, making tax-efficient contributions to your children’s or grandchildren’s pensions is a great way to help set them up for a brighter future.
Pensions can be complicated and any actions will depend on your personal circumstances and financial goals. It’s important to take expert advice based on your individual situation.
Revisit the Lifetime Allowance
If you stopped pension contributions due to the Lifetime Allowance, you should revisit this now the tax charge has been abolished.
Tax efficient alternatives for higher earners
If you have faced a restricted pensions annual allowance since tapering was introduced in 2016, we can advise you on alternatives such as Enterprise Initiative Schemes and Venture Capital Trusts. These offer up to 30% Income Tax relief, but can be high risk.
Use your annual ISA allowances
ISAs are free from Income Tax and Capital Gains Tax. Children under age 18 also have a £9,000 allowance, and those aged 18 to 40 can open a Lifetime ISA up to £4,000, which the government will boost up to £5,000, saving more for your family’s future.
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A little bit of planning goes a long way
Our tax year planning website – provides essential tips and videos to help you make the most of your tax allowances.
Our Guide to Tax Planning –
provides more information on various allowances available to you and actions to help you protect more of your wealth. You can download a free copy of the guide on our tax year planning website.
How we can help you
October’s Budget changes mean that early, proactive financial planning is essential. By taking steps now, you can make the most of available allowances, protect more of your wealth and reduce your potential tax impact. Your Origen adviser can chat through how you can maximise your savings and suggest any actions to put in place. Alternatively, please call us on 0344 209 3924* or email us at clientservices@origenfs.co.uk.
* Lines are open 8.30am – 5.30pm, Monday to Friday. Calls are charged at your phone company’s basic rate. All calls are recorded for business purposes.
The value of tax reliefs depends on your individual circumstances. Tax laws can change. Capital at risk. The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
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