Quarter 4 2015 | Issue 1 Professional Newsletter

WealthDesign

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New Look
In recent months we have been reviewing our branding and communications and in line with this we have launched our new website.

PROFESSIONAL CONNECTIONS

Issue 1 - October 2015

New Look

In recent months we have been reviewing our

branding and communications and in line with

this we have launched our new website at

www.wealthdesign.co.uk.

Please have a look when you get chance. It

was awarded our web designers’ website of

the week!

Tailored to you

If you would prefer to receive a copy of our

newsletter via email rather than through post

or would rather not receive it at all please let us

know your preference.

Email Kiran at Kiran@wealthdesign.co.uk

with your preferred communication type so we

can keep you informed in the way you find

most convenient.

Telephone: 01543 571238 | Email: info@wealthdesign.co.uk

Wealth Design Limited Lagonda Suite | Virage Point | Green Lane | Cannock | WS11 0NH

Wealth Design Limited is Authorised and Regulated by the Financial Conduct Authority.

The Financial Conduct Authority (FCA) regulates the financial conduct industry in the UK and their address is 25 The North Colonnade, Canary Wharf, London, E14 5HS.

You can check this on the FCA’s Register by visiting the FCA’s website www.fca.org.uk/registerFCA No. 647119 or by contacting the FCA on 0845 606 1234.


Implications of the

Budget Changes

Wealth Design’s first newsletter looks in depth at

the proposals from the first purely Conservative

Budget since November 1996. Here are the

main proposals relevant to the financial services

industry:

• A new round of restrictions on tax relief

for contributions to registered pension

plans.

• An overhaul of the tax treatment of

dividends which will increase tax bills

on dividends for the very wealthy, but

reduce or eliminate them for many other

investors, from next tax year.

• The introduction of a new transferable

main residence IHT nil rate band, starting

at £100,000 in 2017/18 and rising to

£175,000 by 2020/21.

• Confirmation that the new personal

savings allowance that was announced in

the March 2015 Budget will be introduced

from April 2016.

Pensions – Act

While You Still Can

The July Budget confirmed some important

changes that will be taking place as regards to

pensions’ tax relief. In particular from 6th April

2016:-

1. Cut back in annual allowance - the

annual allowance for high-income

individuals will gradually reduce from

£40,000 (for those with adjusted annual

income in excess of £150,000) to £10,000

(for those with adjusted income of

£210,000 plus).

2. Reduction in lifetime allowance - the

lifetime allowance will reduce from £1.25

million to £1 million.

Clearly a massive amount of change is taking

place over the next 6 months and it is absolutely

vital that your clients take appropriate specialist

action to deal with those changes and make sure

that they maximise all the opportunities. Call us

for more information.

• Tougher rules on non-UK domiciled

individuals, including an end to nondomiciled

status for all tax purposes once

the period of UK residence exceeds 15

out of the last 20 tax years.

In this Newsletter we look at the impact of the

changes that will affect some of your clients and

the planning opportunities that arise out of these

changes. Please contact us if you need help with

any of the planning solutions.

Telephone: 01543 571238 | Email: info@wealthdesign.co.uk

Wealth Design Limited Lagonda Suite | Virage Point | Green Lane | Cannock | WS11 0NH

Wealth Design Limited is Authorised and Regulated by the Financial Conduct Authority.

The Financial Conduct Authority (FCA) regulates the financial conduct industry in the UK and their address is 25 The North Colonnade, Canary Wharf, London, E14 5HS.

You can check this on the FCA’s Register by visiting the FCA’s website www.fca.org.uk/registerFCA No. 647119 or by contacting the FCA on 0845 606 1234.


Dividend Taxation

– All Change

Big changes are taking place in the taxation

of dividends with effect from 6 April 2016, as

follows:-

• The non-reclaimable 10% dividend tax

credit is to be scrapped;

• A new dividend allowance will be

introduced in 2016/17 of £5,000 for all

individual taxpayers; and

• New tax rates will apply to dividend

income in excess of the new allowance

of 7.5% for basic rate taxpayers, 32.5%

for higher rate taxpayers and 38.1% for

additional rate taxpayers.

So how do these new measures impact on an

investor? Well, this depends on the status of

the individual involved, either as an individual,

a trustee or an owner/director of a private

company. Contact us to find out more about how

these changes may impact your clients.

Inheritance Tax

A number of

important changes

have been

proposed that affect

inheritance tax:

1. Residence Nil

Rate Band - A

new dedicated

Residence Nil

Rate Band

(RNRB) will be

introduced

from April

2017. This will be in addition to the

existing £325,000 nil rate band and will

be to specifically protect the family home

from inheritance tax.

2. Inheritance tax and non-domiciled

persons - From April 2017, inheritance tax

is payable on all UK residential property

owned by non-domiciliaries, regardless of

their residence status for tax purposes,

including property held indirectly through

an offshore structure.

3. Inheritance tax treatment of trusts -

In the December 2014 Autumn Statement

the government confirmed that it would

introduce new “same-day addition” rules

to target IHT avoidance based on multiple

trusts. This will apply in cases where a

settlor adds property, on the same day,

to one or more existing trusts. Typically

this would apply where property passed

to such trusts via the settlor’s Will on their

death.

Please call us for more information on how these

changes could affect your clients.

Telephone: 01543 571238 | Email: info@wealthdesign.co.uk

Wealth Design Limited Lagonda Suite | Virage Point | Green Lane | Cannock | WS11 0NH

Wealth Design Limited is Authorised and Regulated by the Financial Conduct Authority.

The Financial Conduct Authority (FCA) regulates the financial conduct industry in the UK and their address is 25 The North Colonnade, Canary Wharf, London, E14 5HS.

You can check this on the FCA’s Register by visiting the FCA’s website www.fca.org.uk/registerFCA No. 647119 or by contacting the FCA on 0845 606 1234.


Income Tax

A number of changes to Income Tax include:

1. The Personal Allowance – set at £10,600

in 2015/16, rising to £11,000 in 2016/17,

£11,200 in 2017/18 and a proposal to

reach £12,500 by 2020/21. Many people

do not use the current personal allowance

fully and there are several ways we can

make sure your client maximises the use

of their allowances.

2. The Starting Rate Band – For 2015/16, the

starting rate band for savings income was

widened from £2,880 to £5,000 and the

rate reduced from 10% to 0%. To find out if

and how this affects your client, contact us

now.

3. The Personal Savings Allowance - For

people who pay tax at no more than the

basic rate, the personal savings allowance

will mean they can receive savings income

of up to £1,000 free of tax in 2016/17 – a

maximum tax saving of £200. If they pay

higher rate tax then the allowance is £500,

but the overall tax saving is the same £200

maximum. Unfortunately, additional rate

taxpayers will receive no allowance.

5. Individual Savings Accounts (ISAs) -

The limit for 2015/16 for the annual ISA

investment is £15,240 and for the Junior

ISA (JISA) is £4,080. More importantly the

legislation allowing transfers from Child

Trust Fund accounts into JISAs is now in

force, as is that allowing spouses and civil

partners to inherit a deceased spouse’s/

civil partner’s ISA. On 1 July 2015, the ISA

investment eligibility rules were relaxed to

allow a wider range of securities, including

investment trusts which operate in the

peer-to-peer loan market. From 2016/17,

the new personal savings allowance may

make cash ISAs redundant for many

savers, as they will be able to receive

interest tax-free from ordinary deposits.

To find out more about the changes to Income

Tax, please contact us now.

4. Capital Gains Tax (CGT) – Capital gains

are taxable at 18% to the extent they fall

within the basic rate band and 28% if

they fall into the higher or additional rate

bands. For 2015/16, the capital gains tax

annual exemption has risen by £100, with

next year’s increase inflation-linked to the

CPI, so probably another £100.

Telephone: 01543 571238 | Email: info@wealthdesign.co.uk

Wealth Design Limited

Lagonda Suite | Virage Point | Green Lane | Cannock | WS11 0NH

Wealth Design Limited is Authorised and Regulated by the Financial Conduct Authority.

The Financial Conduct Authority (FCA) regulates the financial conduct industry in the UK and their address is 25 The North Colonnade, Canary Wharf, London, E14 5HS.

You can check this on the FCA’s Register by visiting the FCA’s website www.fca.org.uk/registerFCA No. 647119 or by contacting the FCA on 0845 606 1234.

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