Investment4all’s Managing Director says that financially, next year looks more promising for us all than the last few years have, thanks to the announcements in the Autumn Statement, plus Manchester Councils Control and the “NORTHERN POWERHOUSE” speech.
Below, David Wherrit has listed below the highlights of changes he believes will affect us, plus some interesting additions.
In no particular order!
STAMP DUTY on PROPERTY
Nothing on the first £125,000 / 2% on the next £125,000 / 5% above £250,000.
E.g. £250,000 value = £2,500sd [1%] / £500,000 value = £15,000sd [3%].
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INDIVIDUAL SAVINGS ACCOUNT – ISA
Not only did the limit you can invest Tax Free each tax year, increase to £15,000 in July 2014, but now the tax status “on death” has also been changed. Until now, the surviving spouse inherited the investment but the ISA status was lost. Following the Autumn Statement, this anomaly has been removed; therefore the spouse continues to receive the ISA Tax Free status.
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PENSIONER BONDS [for the Over 65s]
They go on sale in January 2015 [no date yet] through NS&I [National Savings & Investments] and are subsidised by the government. They are offered on a “first come, first served” basis. The initial offer is for a limit of £10billion [equal too One Million pensioners @ £10,000 each]. Due to poor interest rates on the High Street, they are likely to be quickly oversubscribed.
You can invest a minimum of £500 and a maximum of £10,000 per bond. Couples can hold a maximum of £40,000 by each taking out a One-Year and a Three-Year bond.
They are “fixed-rate savings accounts” paying interest of 2.80% over a “One Year Term” and 4.0% over a “Three Year Term”. Interest is paid annually or rolled-up for the three year term [compounding], but tax on the interest will be payable at your normal rate. Applications by post, phone or online.
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PENSION CHANGES [basic]
From 6th April 2015, anyone over the age of 55 with a “defined contribution” pension scheme [shown as percentage taken from salary] will be able to access their pension pot as they see fit, with all restrictions taken away. However, your pension provider may not offer these “pension freedoms” and therefore your pension may need to be moved to an appropriate provider, for which charges are likely.
Until the above date, you must be over the age of 60 to access your whole pension as a lump sum and it must be worth less than £10,000 or less than £30,000 if you have more than one pension [all pension values in total].
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HOME for RENT- Did you know?
Did you know that you can Rent Out your Driveway, Rent Out your Storage Space or Rent Out a furnished Spare Room? Under the governments “Rent-a-Room” scheme, homeowners can LET a furnished spare room for up to £4,250 each year, without paying tax on the income.
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CHARITY – LENDING
In addition to the tax benefits of “Payroll Giving” a new announcement by the chancellor allows investors to “Lend Money to a Charity” and it will be possible to claim 30% of this amount as a tax rebate. This tax benefit will allow charities to receive a maximum of £15 Million of investment over the next three years.
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I HOPE YOU ENJOYED READING THE CHRISTMAS NEWSLETTER
David Wherrit MD
INVESTMENT4ALL.CO.UK