Chancellor Headlines – August 2018

The sun may have stopped shining but that hasn’t stopped us bringing you the best news from the financial world.

This month we’re discussing ISAs, pensions, cashflow planning and much more.

Read on for some savvy financial advice.

Claim for higher rate tax relief on personal pension contributions

There are time limits for how long you can claim back tax. This limit is usually four years after the end of the tax year for which you wish to make the claim. This means that for claims made in the current tax year the earliest year that can be claimed for is 2014/15.

To claim the higher or additional rate tax relief HMRC will request evidence from the pension provider of payments made for each tax year which is something the member must arrange personally.

This only relates to Employee contributions and HMRC need to be told the scheme operates on a ‘Relief at Source’ basis and need to be told the gross personal amount within the tax year. They will be aware that basic rate relief is provided at source and will then work out how much tax relief the member may be due and send a tax calculation.  This will tell the member the amount of any tax owed to them.

Click here for more information

Interest rates rise to a two-year high

In a bid to keep the cost of living under control, the Bank of England has raised interest rates from 0.5% to 0.75%.

The change has been made after expectations of a strengthened economy, solid employment levels, more consumer spending and potential wage rises have grown more positive.

To learn more about the rise in interest rates, click here.

What is a lifetime ISA and how does it work?

A new type of ISA has been unveiled – it’s the lifetime ISA, and it’s been specially designed to help people save for their first home or retirement.

Lifetime ISAs can be used to purchase homes with a value up to £450,000, both in and outside of London.

Eligible investors can also make full or partial withdrawals from their Lifetime ISA on an efficient basis when they turn 60.

Click here to find out more about lifetime ISAs

To chat about any of this month’s headlines, get in touch on 01204 526846.