lumin news Issue 8 / Summer 2023

Wealth management I Pensions I Investments I Inheritance & tax planning 

Be better off with expert financial planning Issue 8 I Summer 2023 

! 

Page 3 

Complimentary 

offer: Financial 

Health Check 

INSIGHTS 

AT A GLANCE 

Tax planning 2 

An action plan for the 

2023/24 tax year 

Pensions3 

Higher earners can cut tax 

with pension contributions 

Pensions on divorce 6 

Ensuring a fair outcome for 

divorcing couples 

Tax-efficient investing 7 

Thorough due diligence on 

tax-efficient solutions is key 

Tax planning 7 

Offshore bonds vs. general 

investment accounts 

Investments8 

Consider paying into ISAs at 

the start of the tax year 

Ask our Expert 10 

Questions from our readers 

Meet the Adviser 11 

Will Harries on helping 

clients fulfil their financial 

and lifestyle goals 

Charity engagement 12 

The life-saving mission of 

the Anthony Nolan charity 

Tax changes provide significant 

opportunity for pension savers 

New pension tax rules free diligent savers from the lifetime allowance trap. They can 

boost retirement prospects and save income tax and /or inheritance tax in the process. 

JOE FISHER 

Financial Planning Manager 

joe.fisher@luminwealth.co.uk 

Phone 01727 893 333 

Removal of the pension cap 

The lifetime allowance of £1,073,100, the 

standard cap on pensions, has been scrapped. 

Amounts over the threshold were previously 

subject to an extra 25% or 55% tax charge 

when withdrawing from the pension and /or 

at age 75. Individuals with large pensions can 

now continue, or restart, contributions without 

worrying about the eventual size of their 

pension pot and additional tax liabilities. 

Contributing up to £180,000 

The standard pension annual allowance rose 

from £40,000 to £60,000 from 6 April. Unused 

annual allowances from the previous 

three tax years can facilitate lump sum pension 

contributions of up to £180,000. The current 

tax year offers the last chance to take advantage 

of any unused allowance from 2020/21. 

More flexibility in retirement planning 

Investing more in pensions could mean an 

early retirement is achievable. Pensions are a 

useful estate planning tool, as they are usually 

free from inheritance tax. Further reading: 

Start the tax year on the front foot (page 2) 

Spring Budget: Take advantage of generous 

pension breaks (page 4) 

What do recent tax changes mean for small 

business owners? (page 5) 

Pensions 

Business owners 

Mortgages 

Cut tax bills with 

pension contributions 

Tax planning tips for 

company directors 

Remortgaging and the 

impact of higher rates 

Lumin Wealth is a leading 

firm of Chartered Financial 

Planners with offices in St 

Albans, London and Cambridge. 

We provide financial 

advice and discretionary fund 

management services. 

The recent cut to the additional 

rate threshold means 

higher earners will see a larger 

proportion of their salary fall 

into the highest income tax 

bracket. This places an even 

greater emphasis on pension 

planning to reduce tax. A 

disciplined strategy can see 

higher earners cut tax and 

provide a major boost to their 

retirement pot. Page 3 

An increase to the standard 

rate of corporation tax, high 

dividend tax rates, and a cut 

to the tax-free dividend allowance 

has led to a tough 

tax climate for small business 

owners. But shrewd tax planning, 

as part of a wider and 

robust financial plan, can 

mitigate tax bills, help optimise 

finances, and boost your 

retirement assets. Page 5 

Is your fixed-rate mortgage 

expiring soon? Many borrowers 

face much more expensive 

new mortgage deals 

after rates shot up over the 

past year. But a disciplined 

strategy, and expert advice, 

could help you save thousands 

of pounds. We shine a 

spotlight on key considerations 

if your mortgage is 

coming to an end. Page 9 

lumin news is a periodic publication Circulation: 20,000 copies Publisher: Lumin Wealth Ltd, 5 Sandridge Park, St Albans, AL3 6PH, company no. 03381115. Lumin Wealth Ltd 

is authorised and regulated by the Financial Conduct Authority (reg. number 775068) Editorial: Markus Graf, William Monroe Enquiries and address changes: Phone 

01727 893 333 or info@luminwealth.co.uk Copyright: No part of this publication may be reproduced or transmitted in any form without the prior permission of the editor.

Page 2 lumin news 8 / summer 2023 

Start the tax year on the front foot 

The earlier you plan, the greater your choices and the more potential there is 

to maximise your financial efficiencies and make tax savings. Here we provide an 

overview of key factors to consider in the 2023/ 24 tax year. 

MARTIN COTTER 

Managing Director 

martin.cotter@luminwealth.co.uk 

Phone 01727 893 333 

Now could be a good time 

to hone in on start-of-thetax-year 

basics; namely implementing 

easy tax wins and 

conducting a review of your 

finances. Here are some key 

things to consider: 

ISA and pension 

allowances 

Thousands of pounds can 

be saved each tax year by 

doing the basics well. Each 

adult can pay £20,000 into 

an ISA annually. Under-16s 

have a £9,000 annual allowance, 

while those who are 16 

or 17 can additionally contribute 

up to £20,000 into an 

adult cash ISA equivalent. 

We recommend contributing 

as soon as you can, as 

leaving it to the end of each 

tax year will see you miss out 

on significant growth over 

time. Flexible ISAs allow you 

to withdraw money and replace 

it during the relevant 

tax year, without affecting 

your ISA allowance. 

It’s a similar story when 

it comes to pensions. Earners 

should consider paying in at 

the start of the tax year (not 

applicable for those subject 

to a tapered annual allowance) 

and explore whether 

they are eligible to ‘carry forward’ 

any unused annual allowance 

from previous tax 

years. Non-earners can contribute 

up to £2,880 (net) to 

personal pensions and benefit 

from tax relief. The standard 

annual allowance has risen 

from £40,000 to £60,000, a 

Key factors for the 2023/24 tax year 

Facts & stats 

50% increase that provides a 

valuable incentive for certain 

savers to contribute more to 

their pension. 

Harvesting gains 

Each adult currently benefits 

from a capital gains tax 

Annual Exempt Amount of 

£6,000 (this will be cut to 

£3,000 from April 2024). 

This can be used to harvest 

investment gains annually 

and avoid or reduce a tax 

charge. The allowance must 

be used before 5 April 2024, 

or it will be permanently 

lost. The timing of realising 

gains (in line with market 

sentiment) is an important 

consideration. 

Action & timing 

ISA 

£20,000 allowance per adult; 

£9,000 for under-16s 

Consider contributing as soon 

as you can 

Pension for earners Consider topping up your pension Can be done early in the tax year, 

except for highest earners 1 

Pension for 

non-earners 

£2,880 can be contributed to 

anyone’s personal pension 

Consider contributing as soon 

as you can 

Capital gains 

harvesting 

Use or lose the £6,000 tax-free 

capital gains allowance 2 

Realise gains as part of ongoing 

monitoring of your investments 

Investment strategy Review for changes in your Review annually 

(asset mix) 

circumstances and rebalance 

Mortgages Renewal Plan remortgaging 6 months 

before fixed rate ends; review 

annually 

Estate planning Valid will and power of attorney; 

mitigate IHT liabilities 

Start your estate planning early; 

review your will frequently 

1 In light of the tapering (reduction) of the standard £60,000 annual allowance 

2 £3,000 from 2024 / 25 tax year 

Review your 

investment strategy 

Does your strategy factor in 

a diversified asset allocation 

and match your latest goals? 

How does your overall performance 

compare against 

annual benchmarks? The 

start of a tax year is a good 

time to do an audit of your 

investment strategy. A free 

portfolio health check can 

ensure your investments are 

set up to meet your goals. 

Mortgages planning 

Fixed-rate mortgages often 

allow for voluntary overpayments 

of up to 10% of the 

outstanding mortgage balance 

without triggering early 

repayment charges. Those 

adopting this strategy should 

account for the impact on 

their ISA and pension contributions. 

It’s a good idea to 

plan re-mortgaging around 

six months before a fixed rate 

ends, and review your repayment 

plan annually. 

The start of the tax year 

is an opportune time 

to review your current position 

and plan for the tax year 

and the relevant allowances. 

Creating an annual plan that 

covers your pensions, investments, 

mortgage and other 

areas is an excellent way to 

start the tax year, and it can 

also help keep you on track 

to meet your financial goals. 

To discuss your options for 

the tax year, and how this can 

form part of an overall financial 

plan, please contact a 

Lumin financial adviser on 

03300 564 446. 

FACTSHEET 

ISAs vs pensions 

Request a free factsheet via 

enclosed response card, 

info@luminwealth.co.uk 

or call the Lumin team on 

03300 564 446

lumin news 8 / summer 2023 Page 3 

How higher earners can cut tax 

bills with pension contributions 

MY TIP 

The cut to the additional rate threshold for income tax may make pension 

contributions even more attractive for those with large salaries. 

SARA MOORE 

Senior Financial Consultant 

sara.moore@luminwealth.co.uk 

Phone 01727 893 333 

The additional rate threshold 

was cut to £125,140 from 

£150,000 from 6 April, so 

certain higher earners will see 

a larger proportion of their 

salary fall into the highest 

income tax bracket. But careful 

planning can see pension 

savers reduce their tax bill – 

and boost their retirement 

prospects. Some individuals 

could save up to £81,000 on 

tax in one year. 

Avoiding the personal 

allowance trap 

Pensions can be particularly 

valuable for those with earnings 

above £100,000. If you 

earn over £100,000 per year 

the minimum pension tax 

relief your contribution will 

get is 45%, and for certain 

individuals it can be as high 

as 60%. Expert, independent 

advice can help provide clarity. 

This is one of the areas 

covered in our free Financial 

Health Check (see column). 

Cut tax bills with 

prudent planning 

The standard annual allowance 

for pension contributions 

has risen from £40,000 

to £60,000. Those with an 

Achieve large tax savings with a 

pension contribution 

Assumptions: Income tax on £150,000 net relevant earnings without or 

with maximum £60,000 pension contribution. 

Income tax 

£60,000 

£50,000 

£40,000 

£30,000 

£20,000 

£10,000 

£0 

No contribution 

adjusted income that’s above 

£260,000 will see their annual 

allowance tapered down 

to a new minimum threshold 

of £10,000. 

As the example (above) 

shows, someone with earnings 

of £150,000 could contribute 

£60,000 to their pension, 

and achieve total tax 

savings of £30,000 (including 

the top-up contributions 

paid by the government). 

Certain individuals may 

be able to make higher contributions 

by ‘carrying forward’ 

unused annual allowances 

from the three previous 

tax years. You must use the 

annual allowance in the current 

tax year first, before carrying 

forward from prior 

years. Carry forward from 

2020/21 must be used in the 

2023/24 tax year, or it will be 

permanently lost. 

£30,000 

tax savings 1 

£60,000 contribution 

1 Some of the tax savings may come in the form of the government 

paying money into your pension account 

Inheritance tax 

Your pension can be passed 

on to beneficiaries free from 

inheritance tax. It may be 

possible to repeat this over 

several generations, leading 

to even greater tax savings. 

Pensions passing to beneficiaries 

before the age of 75 

can also be taken free from 

all income tax. 

A financial adviser can 

help you to optimise 

tax allowances. Call 03300 

564 446 for more details. 

FACTSHEET 

Tax-saving tips 

for pensions 





03300 564 446 

MARTIN COTTER 

Managing Director of 

Lumin Group 

Statistics show that many 

people spend more time 

planning for a holiday than 

they do on planning for retirement. 

Savers can spend 

their whole career working 

to build up assets for retirement, 

but often fail to organise 

and optimise these assets. 

To use an analogy people’s 

finances can often look 

like the ‘attic’ at home. For 

some their attic is filled with 

a disorganised assembly of 

items that have been put 

away for use at a later date. 

For others it is a neatly ordered 

and catalogued collection. 

Either way, a comprehensive 

audit of your attic 

can check that everything is 

in good condition and working 

order for when it is 

needed during retirement. 

My Tip: A Financial 

Health Check* with a financial 

adviser can analyse all 

the contents of your attic 

and outline where improvements 

can be made to fully 

optimise your wealth for 

retirement. To book a complimentary 

Financial Health 

Check please scan the QR 

code, or call 03300 564 446. 

investable assets 

*Suitable for 

those with a 

minimum of 

£200,000 of


Spring Budget: Take advantage of generous 

tax breaks for pensions 

The Chancellor’s Spring Budget has provided a significant personal taxation boost 

for higher earners and savers with large pension pots. 

PETER FLOWERS 


peter.flowers@luminwealth.co.uk 

Phone 01727 893 333 

The Spring Budget included 

several valuable breaks and 

benefits for higher earners, 

retirees, and savers with large 

pension pots. But what were 

the tax changes, and how can 

you make the most of them? 

Lifetime allowance 

abolished 

The pension lifetime allowance 

(LTA) of £1,073,100, 

the maximum that can be 

saved into pensions without 

incurring extra tax, has been 

abolished. The 25% or 55% 

tax charge on amounts exceeding 

the threshold was 

removed from 6 April. 

This is great news for 

savers with large pension 

pots, who can continue, or 

resume, payments into their 

pension – and benefit from 

tax relief on their contributions 

– without the risk of 

How higher annual contributions can boost 

the size of your pension pot 

Assumptions: 50-year-old with a current pension pot of £500,000; 

planned retirement at age 65; 3% investment growth p.a. after fees. 

Pension pot size (illustrative) 

£3,000,000 

£2,500,000 

£2,000,000 

£1,500,000 

£1,000,000 

£500,000 

2023 2026 2029 2032 2035 2038 2041 2044 2047 2050 2053 

£40,000 contribution £60,000 contribution 

exceeding the LTA on certain 

test occasions, such as when 

drawing pension benefits, or 

at age 75. 

The tax-free cash lump 

sum entitlement will remain 

at £268,275, which is 25% 

of the original lifetime allowance. 

However, those savers 

who benefit from fixed protection 

can pay into their 

pension again and won’t be 

subject to the £268,275 cap, 

meaning they will benefit 

from their higher tax-free 

cash entitlement. 

Years 

Paying more into 

your pension 

The standard pension annual 

allowance has risen 

from £40,000 to £60,000 

per year. This 50% increase 

provides a valuable incentive 

for savers to pay more into 

their pension (or to get their 

company to pay) and benefit 

from tax relief on their contributions 

and a larger pension 

pot. The example illustration 

(see above) highlights 

how higher annual pension 

contributions can substantially 

boost the amount saved 

into this important asset over 

time. The annual allowance 

includes your personal /employee 

payments, as well as 

employer contributions. 

Regular or one-off pension 

contributions can help 

to substantially reduce your 

taxable income, particularly 

for higher and additional rate 

taxpayers, or if your earnings 

are between £100,000 and 

£125,140 and have an effective 

marginal income tax rate 

of 60% (due to the loss of the 

tax-free personal allowance 

of £12,570). 

Boost for retirees 

Once pension benefits are 

being drawn, tax relief on 

contributions is limited to 

the ‘money purchase annual 

allowance’. This increased 

from £4,000 to £10,000 as 

of 6 April. The increase to the 

allowance may provide retirees 

with an incentive to return 

to the workplace, where 

they would benefit from 

mandatory employer pension 

contributions. 

Effective use of pensions 

and other tax 

wrappers forms the backbone 

of a robust financial 

plan. Call 03300 564 446 to 

speak to a Lumin expert. 

Key tax changes for pensions 

Tax aspect 

New rules 

Lifetime allowance (LTA) 

Excess tax charge removed from 6 April 2023; LTA to 

be abolished entirely from April 2024 

Standard annual allowance Increased from £40,000 to £60,000 from 6 April 2023 

Money purchase annual allowance Increased from £4,000 to £10,000 as of 6 April 2023 

Tapered annual allowance 

Adjusted income threshold rose from £240,000 to 

£260,000 from 6 April 2023 

FACTSHEET 

Tax-saving tips 

for pensions 

Request a free factsheet 

via enclosed response card, 



03300 564 446


What can business owners consider under 

the higher tax regime? 

Company directors face a challenging tax climate. But prudent financial planning 

can help to mitigate tax bills and boost retirement assets. 

KRIS FISHER 

Financial Consultant 

kris.fisher@luminwealth.co.uk 

Phone 01727 893 333 

The standard rate of corporation 

tax has risen from 

19% to 25%, while the dividend 

allowance of £2,000 

has been halved, and is set 

to be halved again for the 

2024 /25 tax year. Dividend 

tax rates also remain high. 

What can company directors 

do to reduce tax and optimise 

their finances under 

these circumstances? 

Increase to the standard 

corporation tax rate 

The corporation tax rate has 

increased from 19% to 25% 

as of 1 April 2023 for limited 

companies with profits exceeding 

£250,000. Companies 

with profits between 

£50,000 and £250,000 can 

benefit from tapered relief 

(see table below). 

Company directors with 

high profit levels may wish to 

consider strategies to extract 

profits from the company in 

a tax-efficient manner. 

Taking a salary 

It is very common for company 

directors to take a salary 

that is equal to, or less than, 

the personal allowance limit 

(this is currently £12,570), 

but above the ‘lower earnings 

limit’ (which is £6,396 for 

the 2023/24 tax year). This 

allows directors to build up 

qualifying years for their 

State Pension, without actually 

paying any National Insurance 

contributions. 

Salaries also count as an 

‘allowable expense’, so a company 

director can pay themselves 

a salary to reduce their 

corporation tax bill. 

Corporation tax rates have increased 

2022/23 2023/24 

Companies with profits 

under £50,000 19% 19% 


over £250,000 19% 25% 


between £50,000 and £250,000 19% 

19 – 24.99% 

(tapered) 

Changes to the tax-free dividend allowance 

Tax year 

Dividend tax rates are 

currently high 

Dividend tax rates remain 

high. A planned 1.25% reduction 

to 2023/24 dividend 

rates was cancelled in October 

2022, with rates currently 

8.75% for basic rate 

taxpayers, and 33.75% and 

39.35% for higher rate and 

additional rate taxpayers respectively. 

The tax-free dividend 

allowance, which was 

formerly £2,000, has been 

cut to £1,000 for 2023/24, 

and is set to be reduced to 

£500 from 2024/25 (see the 

table above). 

Dividends are paid out 

of retained profits, on which 

corporation tax has already 

been paid. This could mean 

there are less dividends to 

distribute once a tax charge 

of 25% has been applied. A 

thorough review of various 

income strategies and streams 

may be able to help company 

directors substantially reduce 

their tax bill. 

Pension contributions 

can help reduce tax 

For a company director, paying 

into a pension via employer 

contributions can be 

a tax-efficient way of extracting 

profits from their business, 

while saving more towards 

retirement. Pension 

contributions are an allowable 

business expense, resulting 

in corporation tax 

savings. Another significant 

benefit is that employers can 

also save on the 13.8% National 

Insurance tax charge 

by contributing directly into 

a pension, rather than paying 

it on a salary. 

Making a large payment 

with carry forward 

You can now contribute up 

to £60,000 to your pension 

per year, unless you are a 

higher earner and subject to 

a tapered annual allowance. 

The maximum contribution 

with tax relief can be up to 

£180,000 in a single tax year, 

if you have unused allowances 

from the prior three tax 

years and were a member of 

a pension plan. You must use 

up your annual allowance 

from the current tax year before 

carrying forward. Unlike 

personal contributions, employer 

contributions via the 

company are not restricted 

by relevant UK earnings. 

With the right financial 

planning, business 

owners can reduce tax and 

boost retirement outcomes. 

To find out more please call 

03300 564 446. 

FACTSHEET 

Dividend allowance 

2022 / 23 £2,000 

2023 / 24 £1,000 

2024 / 25 £500 

Your options for 

your pensions 

Request a free factsheet 

via enclosed response card, 



03300 564 446


Divorce: Ways to share pension assets and 

ensure fair outcomes 

Advice from a professional can help ease the burden 

when dividing pensions during a divorce. 

SIMON RICCA 

Pensions on Divorce Expert 

simon.ricca@luminpensions.co.uk 

Phone 02039 887 788 

Divorces can be a stressful 

and complicated time for 

both parties, but seeking financial 

advice on your pension 

options can help you 

save money, streamline the 

process, and reduce some of 

the worry. 

Pension assets 

in a divorce 

According to the Matrimonial 

Causes Act 1973, the 

value of both parties’ private 

pensions form part of the 

overall distribution of assets 

when a couple go through 

a divorce. This typically includes 

all your private pensions, 

not just assets built up 

during marriage. State Pensions 

can’t usually be shared. 

Splitting pension 

assets 

When dividing the pension 

pots of the respective parties, 

pension sharing is often the 

go-to option. A percentage 

share of one person’s pension(s) 

is transferred to the 

other, in order to equalise 

assets. This is often a favoured 

option as it provides a clean 

break between the parties. 

Another less common 

method is known as offsetting. 

This sees the receiving 

party take less of a percentage 

pension share in favour of 

non-pension assets, such as 

cash or property. Offsetting 

can be an attractive proposition 

if one party requires an 

immediate cash injection. 

However, appropriate liquidity 

is required. 

Pension sharing options in a divorce 

Option Description Use 

Defined benefit 

pensions 

A defined benefit pension 

plan has benefits built up 

over time depending on your 

salary and years of service as 

an employee. A cash equivalent 

transfer value is used to 

assess the cash value of the 

plan’s benefits at divorce. A 

cash equivalent transfer value 

quote will often not be an 

accurate reflection of the 

plan’s true value. It can be 

as much as 50% below ‘fair 

value’, or the true cost of replacing 

the pension benefits 

in the open market. 

If one party has a defined 

benefit pension it is 

important to seek a pension 

sharing report from a qualified 

financial adviser. A report 

will provide a detailed 

breakdown of your options, 

with the aim of ensuring 

equality of income in retirement 

for both parties. 

Hidden complications 

and pitfalls 

There are sometimes a number 

of other hidden complications. 

For example, older 

pension schemes can contain 

certain options, such as guaranteed 

annuity rates offered 

by an insurance company. 

This could mean that your 

pension is actually more valuable 

than the cash equivalent 

transfer value quoted by 

the pension company. 

Significant age differences 

and serious medical 

conditions can complicate 

the picture. A pension sharing 

report will summarise 

such issues and outline the 

available options. 

Planning for 

the future 

Once a decision has been 

reached on the division of 

pension assets, a financial 

adviser can help to arrange a 

pension transfer. They can 

also provide ongoing financial 

planning advice. For example, 

a long-term cashflow 

forecast will analyse expenditure 

and lifestyle, allowing 

you to effectively plan and 

budget for your new way of 

life. A financial adviser can 

also outline investment opportunities 

if you have received 

a cash lump sum as 

part of the division of assets. 

A pension sharing report 

from an expert 

can allow you to understand 

and assess your options during 

a divorce. Lumin Wealth’s 

sister firm, Lumin Pension 

Services, provides simple and 

streamlined pension sharing 

reports that are produced 

much faster than the industry 

average. Please call 03300 

564 446 to find out more. 

Pension 

sharing 

Offsetting 

Earmarking / 

attachment 

Pension rights are irrevocably shared 

at the time of divorce 

Lump sum value of pension is offset 

against other non-pension assets, 

such as cash or property 

One party will receive a proportion 

of their ex-spouse’s pension when 

it starts being paid in retirement 

Widely used due to immediate 

settlement and clean break 

Less common as it requires 

liquidity outside of pension 

and property assets 

Rarely used due to lack of a 

clean break, uncertain timings, and 

potential tax disadvantages 

FACTSHEET 

Pension options 

in a divorce 




or call Lumin Pension 

Services on 03300 564 446


How thorough due diligence on tax-efficient 

solutions creates added value 

Venture capital trusts and enterprise investment schemes can form a valuable part of 

a long-term and tax-efficient investment strategy – but effective due diligence is vital. 

With dividend and capital 

gains allowances having been 

cut from April 2023, private 

investors may increasingly 

seek out less traditional investment 

opportunities. Both 

venture capital trusts (VCTs) 

and enterprise investment 

schemes (EISs) provide an 

opportunity to diversify an 

investment strategy, while at 

the same time reducing your 

tax liability. But they are 

complex, high-risk investments, 

and there are also a 

large number to choose from. 

How, then, can you find the 

right option to match your 

specific needs? 

The importance of 

due diligence 

Extensive and effective due 

diligence is the key to selecting 

suitable EIS and VCT 

solutions that cater to longterm 

investors. At a financial 

advice firm with discretionary 

fund management permissions 

this typically consists 

of a panel or committee, 

made up of financial advisers, 

senior managers and members 

of the investment team, 

who will implement a rigorous 

and multi-layered due 

diligence process. 

Extensive initial screening 

processes seek to establish 

fund details, including 

subscription amounts, target 

returns /dividends, confirmation 

of a fair and transparent 

fee structure, and the history 

of assets under management. 

Additional screening stages 

can score funds on metrics 

including liquidity, performance 

and the investment 

strategy in order to establish 

their suitability. 

An in-depth qualitative 

and quantitative rating system 

is used to score individual 

fund propositions. Factors 

including the long-term 

track record and experience 

of the fund managers, the 

longevity of the proposition, 

and exit strategy are scrutinised. 

The strength of the 

brand recognition (to attract 

top-tier companies and investors) 

is another factor a 

robust due diligence process 

would incorporate. 

Choosing the right 

financial planning partner 

It’s important to choose the 

right financial advice partner 

with a strong due diligence 

process, as not all VCTs and 

EISs are created equal, and 

not all client outcomes are 

positive. 

Lumin’s Client Solutions 

Committee – 

which is made up of senior 

management, senior financial 

advisers, members of the 

investment team, and compliance 

experts – has conducted 

extensive due diligence 

to select our VCT and 

EIS product solutions partners. 

To find out more, call 

03300 564 446. 

FACTSHEET 

Tax-efficient solutions 

for wealthy 

individuals 





03300 564 446 

Offshore bonds vs. general investment accounts 

Many higher earners who use 

up annual pension and ISA 

allowances turn to general 

investment accounts, which 

offer flexibility and easy access. 

However, general investment 

accounts are subject to 

income or capital gains tax. 

Recent cuts to tax allowances 

mean offshore bonds may 

provide greater tax advantages 

for long-term investors. 

Tax shelter for 

investors 

The tax-free allowances for 

capital gains and dividends 

have been halved to £6,000 

and £1,000 for the 2023/24 

tax year, and both allowances 

will be cut in half again from 

2024 /25. As a result, offshore 

bonds – investments held 

within a single-premium life 

insurance policy – could be 

more tax- efficient than general 

investment accounts for 

certain investors. Investment 

growth is added, or rolled up, 

in an offshore bond with tax 

deferred into the future. You 

only pay income tax on the 

gain when you encash the 

bond and on the difference 

to the original investment 

value. This can be a useful 

planning tool if you will be 

a lower rate taxpayer at the 

time of encashment. Investors 

can also benefit from ‘top 

slice relief ’, which allows you 

to divide the chargeable gain 

by the number of years it has 

been active to remain within 

basic /higher rate tax bands. 

Inheritance tax (IHT) 

advantages 

Many offshore investment 

bonds consist of segments 

that can be assigned to beneficiaries 

without incurring 

an immediate tax liability. 

After seven years the assignment 

is considered outside of 

the estate for IHT purposes. 

If the beneficiary is a lower 

rate taxpayer at the time of 

encashment, it would be another 

advantage. 

Which tax wrappers 

or investment solutions 

are right for you? As an 

independent IFA, Lumin has 

access to a range of products 

and solutions. Call 03300 

564 446 to learn more.


Pay into your ISA at the start of 

the tax year for maximum benefit 

Many investors contribute to stocks and shares ISAs at the end of the tax year, 

as the 5 April deadline draws near. But this can lead to a lot of money being left on 

the table over the years. 

FACTSHEET 

Make the most of 

your ISAs 





03300 564 446 

FIONA READ 


fiona.read@luminwealth.co.uk 

Phone 01727 893 333 

Every UK adult can pay up 

to £20,000 into an ISA each 

tax year. Under-16s can contribute 

£9,000 a year, while 

those who are 16 or 17 can 

additionally contribute up to 

£20,000 into an adult cash 

ISA equivalent. Adding to 

stocks and shares ISAs as 

early as possible in a tax year 

can be beneficial over the 

long run. Stocks tend to rise 

over time, and so it normally 

pays to be invested sooner 

rather than later. 

The ‘snowball effect’ 

The benefits of compounding 

mean that your investments 

get bigger over time 

with every roll. Paying into 

your investment ISA at the 

start of the tax year allows 

your ‘snowball’ to roll from 

the top of the hill. 

The illustrative example 

(right) highlights the difference 

early payments can 

make to investment returns 

over time. If a saver contributed 

£12,000 annually into 

an investment ISA at the 

beginning of each tax year, 

rather than the end, they 

would be nearly £27,000 

better off after 30 years. 

Long-term rewards 

Share prices do of course 

fluctuate. In good years you 

can reap large gains, but there 

will also be lean years when 

your investments may decline. 

The average return on 

UK equities is just under 8% 

over the past 60 years. Holding 

other assets can help 

smooth out returns (this is 

known as diversification). 

ISAs – and other tax 

wrappers such as pensions 

– form a valuable part 

of an overall financial plan. 

Contact the Lumin Financial 

Planning team on 03300 564 

446 to find out more. 

ISA subscription: Start vs. end of tax year 

Assumptions: £12,000 annual subscription; 4% net investment return; 

figures rounded. 

Illustrative 

Timing of top-ups 

investment 

value after: 

End of Start of Difference 

tax year tax year 

5 years £65,000 £67,600 £2,600 

10 years £144,100 £149,800 £5,700 

20 years £357,300 £371,600 £14,300 

30 years £673,000 £699,900 £26,900 

Lumin and VZ: Expert and trusted financial advice 

Expert financial advice continues 

to lead to positive results 

at VZ Group, Switzerland’s 

leading independent 

financial services firm, which 

partnered up with Lumin 

from May 2021. 

What does this mean 

for you? 

As part of an exceptional and 

financially secure group that 

has been well-established for 

30 years in Switzerland, both 

current and future Lumin 

clients can be confident they 

are in very safe hands, with 

the requisite range of advice 

capabilities and a very strong 

commitment to enhancing 

client propositions and experiences. 

Lumin has also been 

investing in an Academy to 

train and develop a younger 

generation of financial advisers 

to counter a general shortage 

of advisers in the UK. 

The bottom line is that 

you can count on Lumin as 

your trusted, long-term, professional 

partner to look after 

your financial advice and 

wealth management needs, 

both now and in the future. 

To find out more about VZ 

and its financial results please 

visit the following link: vzch. 

com/financial-reports. 

VZ Group: AUM and client numbers 

AUM = assets under management (in CHF millions) 

70,000 

60,000 

50,000 

40,000 

30,000 

20,000 

10,000 

0 

2012 

Total AUM 

2014 

2016 2018 

Years 

2020 

Number of wealth management clients 

2022


Remortgaging: Ways to lessen 

the impact of higher rates 

Many borrowers face much more expensive new mortgage deals after rates shot 

up over the past year. But a disciplined strategy could save thousands of pounds. 

Welcoming our 

new mortgage 

partners 

JOE FISHER 


joe.fisher@luminwealth.co.uk 

Phone 02039 887 788 

Is your fixed-rate mortgage 

expiring soon? Some of the 

explosive jump in fixed-term 

interest rates seen over the 

past year has been reversed 

in recent months, but levels 

remain much higher than for 

most of the past decade (see 

chart). Unusually, rates for 

five-year mortgages are below 

two-year fixes. Variable 

mortgage rates have continued 

to rise as the Bank of 

England increases official 

interest rates to fight inflation. 

This article covers key 

considerations if your mortgage 

is coming to an end. 

Start looking early 

You can normally secure a 

deal up to three to six months 

Higher mortgage rates 

7% 

6% 

5% 

4% 

3% 

2% 

1% 

0% 

2013 

2015 

2017 

in advance. If you don’t act 

in time, you could end up on 

expensive standard variable 

rates. It may take a couple of 

months to remortgage, but 

this can be quicker if you’re 

switching to a new mortgage 

at your current lender. 

Tip: A good mortgage 

broker can often find you a 

cheaper rate. They may also 

monitor the locked-in rate 

and reduce it if the lender’s 

rates drop before your rate is 

due to start. 

Loan-to-value (LTV) 

The LTV measures the outstanding 

mortgage amount 

against the market value of 

your home or property, with 

the difference being your 

equity. The lower the LTV, 

the better the mortgage rate 

(up to a point), which means 

lower monthly repayments 

and better affordability. Market-leading 

mortgage rates 

are normally available for 

LTVs of 60% or below. 

Tip: You could appeal a 

lender’s valuation if you have 

2019 

Years 

2021 

2-year fixed 5-year fixed 2-year variable 

Source: Bank of England; interest rates on 75% LTV mortgages 

to households 

2023 

made significant home improvements, 

as this may lower 

the LTV. Providing photographic 

evidence can ‘build 

the case’ with the lender. 

Repayments 

You may be able to lengthen 

the mortgage term and reduce 

monthly repayments. 

This requires a full lender 

review of your finances. You 

could potentially choose to 

keep repayments at the same 

level as before, for a budgeting 

cushion. If needs be, you 

could reduce repayments to 

the minimum level. Interestonly 

mortgages are also a 

way to keep monthly mortgage 

payments in check. 

Tip: Interest-only mortgages 

tend to be more readily 

available on investment 

properties. 

Fixed vs. variable rates 

Choosing the mortgage type 

(fixed versus variable) or the 

length of a fixed-rate period 

can be a daunting task. 

Tip: A mortgage adviser 

can help you make this key 

decision by highlighting rate 

comparisons, and the advantages 

and drawbacks of different 

products. 

Don’t rest on initial 

offers. The basis on 

which banks set mortgage 

rates has come down, and 

this, together with increased 

bank competition, has led to 

cheaper UK rates. Call 03300 

564 446 to learn more. 

Mortgage specialists Davidson 

Deem have recently 

joined the Lumin family. 

Joint directors Peter Stokes 

and Brian Keane both have 

a wealth of experience that 

Lumin clients and future clients 

can now readily access 

on an ongoing basis. 

Davidson Deem provides 

a bespoke service that 

sees clients deal directly with 

Peter or Brian. This enables 

them to provide a highly personalised 

service and has resulted 

in a loyal client base, 

with some existing clients 

partnering up with them for 

more than 20 years. 

Davidson Deem sources 

deals from across the UK 

mortgage market, and has 

particular expertise when it 

comes to advising high-networth 

individuals including 

doctors, lawyers, and company 

directors. They charge 

a standard mortgage advice 

fee of up to £400, but Davidson 

Deem does not charge to 

help you select a new rate 

with your existing lender. 

FACTSHEET 

Top tips on 

remortgaging 





03300 564 446


Ask our Expert 

Your financial planning questions answered 

Lumin’s Financial Planning Manager Jason Coppard answers readers’ 

questions on filling National Insurance gaps, lifetime ISAs, and what tax 

changes mean for a saver with a protected pension lifetime allowance. 

JASON COPPARD 


jason.coppard@luminwealth.co.uk 

Should I fill gaps in my National Insurance 

record to boost my State Pension? 

You need to have made 35 years of National 

Insurance contributions (NICs) 

to get the full new State Pension (currently 

£10,600 per year). If you have 

fewer than 35 qualifying years, you will 

receive less, depending on the number 

of missing years. You need at least 

10 qualifying years to receive any new 

State Pension at all. 

Usually, gaps can only be plugged 

for the past six tax years, but until 

31 July you can go as far back as the 

6 April 2006 (for men born after 

5 April 1951 and for women born after 

5 April 1953). Gaps can be filled by 

making voluntary Class 3 NICs, which 

are £824 if you haven’t worked at all 

during a tax year. 

Making voluntary NICs to fill gaps 

can be lucrative. An eligible person with 

You currently benefit from fixed protection, 

which means that your lifetime 

allowance (LTA) – the maximum that 

can be saved into pensions without incurring 

extra tax – is higher than the 

(former) standard LTA of £1,073,100. 

In your case your LTA threshold has 

been set at £1,500,000, courtesy of 

Fixed Protection 2014. 

In the March Budget the government 

opted to cancel the LTA penalty 

tax charge of 25% or 55% on amounts 

exceeding the threshold. Previously this 

excess tax charge applied in the case of 

certain events, such as when savers first 

accessed their pension benefits, or at 

34 qualifying years at the end of their 

career could boost their State Pension 

entitlement by over £300 annually by 

adding an extra year. In this scenario, if 

you lived until age 85, you could receive 

£5,500 more by contributing £800. 

Tip: Check for gaps via www.gov. 

uk/check-national-insurance-record. A 

financial adviser can help you understand 

if /when and how you can achieve 

your desired living standard during 

your retirement. 

FACTSHEET 

5 things to consider: 

Planning your retirement 

Request a factsheet via the response 

card, info@luminwealth.co.uk or 

call the Lumin team on 03300 564 446 

What do recent tax changes mean for my 

protected pension? 

age 75. In your case, you can now restart 

your pension contributions without 

losing your Fixed Protection 2014 

benefits, and you won’t face an excess 

tax charge liability. 

The tax-free cash entitlement (or 

‘pension commencement lump sum’) 

was fixed at £268,275 (25% of the former 

standard LTA of £1,073,100) from 

6 April 2023. However, this cap will 

not apply to your pension pot. Those 

with fixed protection can continue to 

pay into their pension and benefit from 

their higher tax-free cash protection. In 

your case this will be £375,000 (25% 

of £1,500,000). 

Should my son invest 

in a lifetime ISA? 

Your son is 29 and wishes to put some 

savings, which he has been holding in a 

low-interest cash account, into a taxefficient 

investment wrapper. A lifetime 

ISA (LISA) may be a sensible place to 

start his investment journey, due to the 

generous 25% government bonus. 

UK adults aged 18 – 39 can currently 

contribute up to £4,000 per year 

into a LISA, and benefit from the 25% 

bonus, meaning a £5,000 annual contribution 

if you use the maximum allowance. 

This allowance counts towards 

the £20,000 ISA limit. Once you turn 

50, contributions are no longer possible, 

but the LISA holder will continue 

to benefit from investment returns (or 

interest if it is a cash LISA). 

I have produced an example calculation 

to highlight the benefits of the 

LISA scheme. I have assumed that your 

son, who was born in September, will 

pay £4,000 annually into an investment 

LISA at the start of each tax year, until 

he is 50. I have assumed a 5% net investment 

return per annum (although 

returns will vary from year to year). 

Once your son reaches 60 – the age 

he can access his LISA without a tax 

charge applying, unless the money is 

used to buy a first home costing less 

than £450,000 – his investment pot 

would total £321,000, against a personal 

contribution of just £84,000. 

FACTSHEET 

ISAs vs. pensions 

Request a free factsheet via the 


info@luminwealth.co.uk or arrange 

a call with Jason via 03300 564 446


OPINIONS 

Meet the 

Adviser: 

Will Harries 

Financial Consultant Will Harries explains how he’s 

made the transition from playing professional rugby 

to helping clients tackle their retirement journeys 

and fulfil their financial and lifestyle goals. 

Will in action during his Wales debut against New Zealand in Hamilton 

What are the similarities between 

financial advice and sport? 

Performing at a high level as a professional 

sports player leaves no room 

for error. You need to make sure your 

pre-match analysis and plan is accurate 

and is implemented as efficiently as 

possible. Communication is also vital 

to success in professional sport. As a 

financial adviser you need to be able to 

effectively communicate both the details 

and benefits of a financial plan to 

a client. At Lumin we keep our advice 

as simple and as straightforward as possible, 

so communication with clients 

has to match this. 

What transferable skills have you 

brought from your rugby career? 

Problem-solving, attention to detail 

and the ability to analyse and deliver 

on pre-planned strategies are all key 

traits that served me well in my rugby 

career, and which I now employ on a 

regular basis as a Financial Consultant 

at Lumin. 

Working alongside a wider team – 

including administrative colleagues, 

paraplanners and in-house investment 

professionals – to create and implement 

a specific, tax-efficient financial plan for 

a client is similar to the off-field analysis 

we did ahead of rugby matches. You also 

meet people from all walks of life as a 

Financial Consultant, so the social nature 

of rugby helped prepare me for this 

aspect of the job. 

How did Lumin make the transition 

from rugby easy for you? 

While studying for each exam that 

makes up the Level 4 Diploma in Regulated 

Financial Planning I was paired 

up with a senior adviser. I attended client 

meetings from pretty much day one, 

which helped transfer exam knowledge 

into a real-life setting. 

What’s the best thing about being a 

financial adviser? 

I think the most rewarding thing is 

being a genuine financial advice partner 

for a client. At Lumin we don’t just give 

our clients advice on their retirement, 

we actively come on that journey with 

them. Helping clients achieve their financial 

and lifestyle goals via a structured 

and tax-efficient financial plan is 

a really rewarding experience. 

And lastly, what was the highlight 

of your rugby career? 

It has to be playing in my first international 

game for Wales against the 

All Blacks in New Zealand in 2010. I 

was named in the training squad, as 

cover for the main travelling squad. 

Shane Williams picked up an injury, 

and I got the nod to travel to Hamilton. 

Stepping out onto the pitch and facing 

the Haka on New Zealand soil was 

pretty special. 

WILL HARRIES 

Will joined Lumin in 2020 after 

a successful career as a professional 

rugby player for clubs 

including Northampton Saints 

and Newport Gwent Dragons. 

He has a Level 4 Diploma in 

Regulated Financial Planning 

and is working towards 

achieving Chartered status. 

Lumin is always keen to hear 

from enthusiastic career-changers, 

graduates, or qualified financial 

advisers who excel in providing a quality 

client service. Academy members 

benefit from a fully funded and supported 

training programme, which is 

run by Learning and Development 

Manager Rebecca Lawrie. 

Do you know someone who would like 

to be a part of Lumin’s exciting growth 

plans? They can send their CV to 

careers@luminwealth.co.uk or visit 

luminwealth.co.uk/careers

Page 12 | summer 2023 

ENGAGEMENT 

Lumin’s charity partners: Our 

fundraising for Anthony Nolan 

Chief Investment Officer Mike Felton explains why he and Lumin colleagues have 

a special affinity with the Anthony Nolan charity. 

© Anthony Nolan 

I am immensely grateful to 

the Lumin team for their ongoing 

support for this wonderful, 

life-saving charity. 

Through a combination of 

raffles, auctions, cake bakes 

and a London Marathon runner, 

we have raised significant 

funds to help support 

the charity in its vital work. 

Anthony Nolan operates 

the UK stem cell register, 

which offers the last chance 

of life for someone with 

blood cancer or a blood disorder 

whose other options 

have been exhausted. 

The charity saves lives 

every day – three lives a day 

in fact. In 2010, I was one 

of those lives. My treatment 

for leukemia was no longer 

working and I was in desperate 

need of a bone marrow 

transplant. Anthony Nolan 

found a perfectly matched 

donor, Trevor from County 

Durham, on its register. Ever 

since our first meeting, Trevor 

and I have been the best 

of friends – his selfless act 

helped save my life. I’m very 

grateful to have the support 

of my colleagues as we continue 

to support this special 

charity. To find out more 

about joining the register, or 

to make a donation, you can 

visit anthonynolan.org. 

NEWSLETTER 

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AWARDS 

ABOUT LUMIN WEALTH 

For growing, managing or protecting wealth, 

you are in expert hands with Lumin. 

You can count on our expertise in: 

Lumin Wealth 

St Albans Office 

5 Sandridge Park 

Porters Wood 

St Albans, AL3 6PH 

Phone 01727 893 333 


www.luminwealth.co.uk 

London Office 

Cornwell House 

21 Clerkenwell Green 

London, EC1R 0DX 

Phone 02039 887 788 

Cambridge Office 

Milton Hall 

Ely Road, Milton 

Cambridge, CB24 6WZ 

Phone 03300 564 446 

• Pensions & retirement 

• Inheritance & tax planning 

• Investments 

• Protecting family & business 

• Cashflow planning 

• Financial planning for 

business owners 

• Mortgages 

Advice made easy: Scan the 

QR code to arrange an initial 

meeting over a coffee. 

Our content constitutes a ‘financial promotion’ for the purposes of section 21 Financial Services and Markets Act 2000 (United 

Kingdom) (‘FSMA’). This publication is for general information only. It does not constitute advice or (by itself), a basis for any 

financial decision. You should only make such decisions based on your individual circumstances and, we recommend, with advice 

from suitably qualified advisers working for a regulated firm. Whilst we try to be accurate, Lumin Wealth does not accept responsibility 

for any inaccuracies in this publication or for any loss that may result from reliance on it, but this disclaimer does not affect 

our responsibilities or your rights under the FSMA or other applicable UK law and regulation. Any financial projections in this 

document are provided for illustrative purposes only and should not be regarded as predictions. Past performance 

is not a guide to future returns. The value of investments may fall as well as rise and you may get back 

less than you invested. Tax treatment depends on your individual circumstances and rules may change. The 

Financial Conduct Authority does not regulate tax and estate planning.

lumin news Issue 8 / Summer 2023

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