News
Pensions Update 2012
The New Retirement Landscape
For up to date information on pension legislation visit our publication page (Pensions Update 2012)
Protected Rights to be abolished from 6 April 2012
From 6 April 2012 it will no longer be necessary for money purchase pension schemes to recognise Protected Rights funds as separate benefits, therefore in the future all funds will be consolidated and treated in the same way.
- S2P clients who were previously contracted-out will no longer have any rebates paid into their pension plan by the Government.
- All funds built up within money purchase pension arrangements will be payable on retirement in the same way without any of the restrictions previously applying to Protected Rights annuities.
- Clients currently considering buying anannuity with Protected Rights funds may wish to delay until the changes come into effect as consolidating all pension savings could result in higher annuity rates and a wider choice of annuities.
- Death benefit can in the future be payable as a lump sum.
Why not contact us for further details on 01372 844344 or email at info@blacktowerfm.com
Tax Planning
Carry forward is a new rule introduced from the tax year 2011/2012 onwards that could allow you to contribute up to £200,000 into your pension tax efficiently before 6 April 2012 by rolling up unused allowance from previous years in the UK. If you are:
- A high earner whose pension contributions have previously been limited by anti-forestalling rules
- Near retirement and you wish to boost your pension fund.
- If you want to opt for fixed protection before lifetime allowance reduces to £1.5m from 6 April 2012.
- If you are going to receive a large bonus or redundancy payment.
- Self-employed who have earned signficantly more than usual this tax year.
- Company directors seeking to reduce your corporation tax bill.
- Defined benefit scheme members who receive a large salary increase
You should contact 01372 844344 to see how we may be able to assist you, or email info@blacktowerfm.com
Changes to Personal Income Tax in Spain
Changes to Personal Income Tax in Spain
Do you hold an Investment Bond product issued by a non-eu jurisdiction like the Isle of Man, for example Friends Provident International or Scottish Widows International or still sit on investments arranged whilst resident in the UK? If the answer is yes you would be advised to make a cup of tea and get a plate of Digestives and continue reading.
The previous PSOE Government, made a temporary amendment to the personal income tax law in Spain, before the recent General Elections, that could leave investors in non-tax-compliant offshore bonds facing a higher tax bill in 2014. Whilst many though that the newly elected PP Government would reverse this, this has not been the case.
On 1 January, the Spanish personal income tax regime was temporarily modified resulting in a rise in income tax for 2012 and 2013. While the changes will have “little or no impact” on those who hold tax-compliant offshore bond policies until at least 2014, normally issued out of jurisdictions like Dublin, those using non-compliant tax-compliant products will pay up to 3% more each year in tax both this year and next.
So what does this mean? Well Skandia have said that from the 1 January this year to the end of 2013, gains on tax-compliant offshore bonds will be taxed at a rate of 21% (as opposed to the normal rate of 19%) which is then withheld by tax-compliant providers. There will be no further personal income tax liability for the policyholder if the gains amount to less than €6,000 (£4,981, $7,661) savings income in a tax year – including interest earned on savings accounts and dividends received in the same tax year. A further 4% personal income tax liability will need to be accounted for by the policyholder on the next €18,000 savings income and a further 6% if the overall savings income for that tax year is above €24,000. If the policy suffers a loss over the tax period, the loss can be offset against other income tax liabilities.
In contrast, non-tax-compliant policies are required to withhold tax every year and so will be further affected by the increase during the next two years. Skandia also went on to advise that, in instances where the provider of a non-compliant policy fails to withhold tax correctly, and in a timely manner, policyholders may become subject to penalties for non-reporting, and these can range from 50% to 150%.
However, Skandia conceded that non tax-compliant policies have their merits as such policies can offer other features which can make them attractive to certain types of investors – for example, by providing access to a wider investment universe of assets and the ability offset losses on an annual basis.
What is clear is that in today’s world, the choices available to investors can be overwhelming. It is crucial investors understand the implications of choosing the right product in order to utilise the available tax advantages to the full.
For example, tax-compliant bonds reduce the burden of reporting on individuals classed as tax-resident in Spain and can be affected by changes in tax regimes to a lesser degree than non tax-complaint alternatives. The recent changes introduced on 1st January 2012 illustrate these advantages perfectly.
But please don’t make a ‘hasty’ decision without first reviewing what you have and the tax implications with a qualified financial adviser.
Happy New Year
Happy New Year to all our clients and colleagues from Blacktower Financial Management Group.
UK Autumn 2011 Statement
See attached key announcements from Chancellor George Osborne including:
- Key announcements
- Economic Background
- Benefits & Tax Credits
- Transport tax and duties
- Business Finance
- Employment and regulation
NEST (National Employment Savings Trust)
NEST further information available.
International Adviser Article
Article in International Adviser June 2011 http://www.international-adviser.com/article/blacktower-fm-unveils-nexus-global-network
Blacktower Financial Management Unveils Nexus Global Network
Nexus Global Network
Blacktower Financial Management (International) Ltd has launched an IFA support network designed to help other European advisory firms handle their growing regulatory compliance requirements.
The Group Managing Director, John Westwood said the network, known as Nexus Global (NXG) will enable firms to keep their branding and identity, while taking advantage of Blacktower’s established licensing and compliance structures.
Paul Brown, Chairman of Netherlands-based WorldWide Broker has also been working with John Westwood in setting up Nexus Global and is on the NXG management committee.
Five affiliate organisations have so far signed up with Nexus, while a further five are going through the application process. It is hoped to have a network of between 10 and 15 affiliates by the end of the year.
The Nexus Global website address is: www.nexus-global.net where further information can be found of its services.
Blacktower Merges with Ritchie Salkeld & Company LLP
Blacktower Merges with Ritchie Salkeld Company LLP
On the 27th May 2011, Blacktower acquired Ritchie Salkeld & Company LLP. Ritchie Salkeld has now become the Managing Director of Blacktower Financial Management Limited in the UK and also undertakes the responsibility for Compliance & Money Laundering for the UK Company. Ritchie will be assisting the other members of the Board in running the UK operation and making sure Blacktower are ready and prepared for RDR.
Ritchie and the UK board will continue to report to the Group Managing Director John Westwood
Ritchie has vast experience within Financial Services, having already completed 38 years, during which time he held a number of very senior positions with what are now called product providers. About 27 years ago he was one of the earliest IFA members of NASDIM, who ultimately became FIMBRA, the PIA and then the FSA.
For the past 17 years, he has very successfully run Ritchie Salkeld & Co (now LLP) and brings with him a wealth of experience and very established and loyal clientele.
Ritchie has know Blacktower pretty well since it was first formed and has a close association with the Westwood family and Paula Smith.
Under the Mattress or into the World?
What to do with our hard-earned savings. We spend all these years building our nest-egg only to see interest rates on offer below the rate of inflation, volatility in the markets and sovereign debt all over the place. So where do I go to get some solid growth these days?
Global - The growth outlook in major industrialised nations is diverging, with activity improving in North America, China and Russia, and moderating in most European countries, the Organisation for Economic Co-operation and Development's (OECD) leading indicator for March showed on Monday. The OECD said its composite leading indicator for member countries rose to 103.2 points in March from 103.0 in February, well above a long-term average of 100. The indicator showed "regained momentum in economic activity" in China and Canada while the U.S., Germany and Russia were also in the midst of above-trend expansion.
China - China's consumer price index (CPI) inflation in April was down on March but has still exceeded the official government target of 4%, according to the latest results from the country's statistics bureau. The 5.3percent year on year rise was down only slightly on the 5.4% number in March. The figure has lead to fresh speculation that China may be forced once again to raise interest rates. The People's Bank of China has already hiked rates four times since October 2010 in a bid to gain control over a perceived overheating of the economy. The rate on one-year deposits is currently 3.25%, while the lending rate remains at 6.31%
India- India's industrial production grew at the fastest pace in five months, underscoring the central bank's concerns that consumer demand is stoking inflation. Output at factories, utilities and mines rose 7.3% in March from a year earlier after a revised 3.7%gain in February, the commerce ministry said in a statement in New Delhi. The Reserve Bank of India last week boosted interest rates for the ninth time in 15 months to damp price gains that are the highest among Asia's major economies. The International Monetary Fund, Goldman Sachs Group Inc. and Credit Suisse Group AG expect India's expansion to ease this year because of monetary tightening. "The RBI is focused at the moment on curbing demand to stem inflation," Robert Prior-Wandesforde, an economist at Credit Suisse in Singapore, said before the report. "Rising rates will ease demand and slow growth."
Germany - German exports surged in March to their highest level since records began, as the growing global economy lifted demand for its products and services. The country's exports for the month totalled EUR98.3bn, 7.3%higher than February. Its imports also reached an all-time high, up 3.1% to EUR79.4bn. Both imports and exports are the highest since data started to be collected in 1950.
Germany is the world's second-largest exporter.
Greece - Rating agencies are united in their negative outlook on Greece as Standard & Poor's, Moody's and Fitch all made further negative comment about the country's continued inability to repay its debt. At the end of last week, S&P's went as far as downgrading Greece's long and short-term sovereign credit to B from C, and from BB- to B respectively, following comments from its Labour Minister that it will not be able to raise funds with new bond issues next year, as it is required to by the terms of its bailout package. Fitch has retained its negative outlook for Greece, which has consistently failed to meet the agreed terms of its rescue package, while Moody's is making more negative noises placing its B1 local and foreign currency government bond ratings on review for possible downgrade. A debt restructure is now seen by many as inevitable, partly to keep German consumers and voters happy, though S&P's has already warned that any such voluntary restructure will be seen as a default.
U.S. - U.S. exports set a record in March, buoyed by the weak U.S. dollar and strengthening global demand as U.S. trade flows returned to levels last seen before the global financial crisis. U.S. exports grew 4.6percent in March to USD172.7bn, surpassing the record set in July 2008 before world trade took a sharp downturn. The March export rise was the biggest month-to-month gain in 17 years, the Commerce Department said in a report on Wednesday. "It's taken two-and-a-half years, but the level of exports has finally returned to pre-recession levels," said Paul Dales, senior U.S. economist with Capital Economics in Toronto.
Commodities - Gold and silver dropped, as the dollar advanced against major currencies, reducing demand for precious metals as an alternative investment.
Immediate-delivery gold fell as much as 0.7% to USD1,491.30 an ounce. "Gold is coming under pressure as the dollar is gaining some ground," said Ong Yi Ling, Singapore-based analyst with Phillip Futures Pte. "The trend for precious metals in the short term is still bearish."
Spotlight on: value in Europe
Investors should stop focusing on the sovereign debt crisis and build up their exposure to undervalued equities on the continent, according to Adrian Bignell, manager of the Invesco Perpetual European Opportunities fund.
"I think it is important that investors keep economics and investment separate. Everything that is going on in the economies of Ireland, Portugal and Spain has little bearing on the outlook for the European equity market," said Bignell.
"Media headlines about the sovereign debt crisis are very discouraging, but in reality European companies are on a par with those in the U.K. and U.S., at a much cheaper price." "Profit margins are above expectations, balance sheets are strong, and crucially stocks are available on a big discount, European equities are trading around 10.5 times earnings, compared with 14 times from the U.S.," he added.
According to Financial Express data, Invesco Perpetual European Opportunities has decreased its exposure to international equities in favour of the European market in the last six months. In October 2010 the fund's exposure to European equities was 63%, this figure is now just under 90%
Bignell says he has hedged his portfolio against the downside risks associated with the sovereign debt crisis by avoiding direct exposure to the PIIGS (Portugal, Ireland, Italy, Greece and Spain) economies and decreasing his exposure to financials. The fund was overweight in banking stocks in the spring of 2009 as a short-term play, but financials now account for only 7% of the portfolio. Invesco Perpetual European Opportunities has outperformed its IMA Europe ex UK sector by just under 19% in the last three years, albeit with significantly more volatility.
Bignell is particularly positive about Germany, which has a regional weighting of 23%in his portfolio. "Low interest rates and a weak currency are favourable for German exports, which are booming at the moment," he explained.
According to official statistics, only China made more money from exports than Germany in 2010.The manager also favours the small and mid cap markets over large caps, even though some commentators fear the out-performance of smaller companies may be coming to an end.
He commented: "We believe the best growth opportunities are still in the small and mid cap markets. Many large cap companies are attractively priced, particularly those in the pharmaceutical and industrial sector that are yielding up to 5%. However, smaller companies have better pricing power, and economic policy has less of an impact on them."
'This facility is not suitable for all expatriates, and we recommend that advice is sought before one makes any commitment. As an Independent Financial Adviser, Blacktower seeks to ensure that our clients receive the advice suitable for their specific circumstances. Please contact us for further details 289 355 685'
Andrew Hammond achieves Chartered Status
Andrew Hammond achieves Chartered Status. The Directors & Staff of Blacktower Financial Management, both UK and International would like to congratulate Andrew Hammond for obtaining the professional standing enabling him to be elevated to the esteemed status of Chartered Financial Planner.
Chartered Status is the professions' gold standard for a Financial Planner.
This qualification is the equivalent of a Bachelor's Degree.
All Chartered Financial Planners operate under an additional code of ethics, which is supported by all of us at Blacktower.
British Chamber of Commerce in Spain - Annual Golf Tournament
The British Chamber of Commerce in Spain Andalucia Committee held their Annual Golf tournament on May 6th 2011. This event is growing in stature and this is down the fantastic organising of Ronan and his staff at Golf the Costa and the help and support from the sponsors.
Blacktower Financial Management were the main sponsors and their logo was seen on sweatshirts and banners throughout the course and throughout the day. The weather was wonderful for golfers on the El Paraiseo Golf course and for those whose spirits and scores were flagging then the smell from the hog roast and the accompanying glass of cava helped (or not) with the next few holes.
Dinner at night was held at Da Brunos Sul Mare Restaurant and over 160 people attended and watched the prize giving and enjoyed a great opportunity to network. Awards were presented by Jennie Thompson (BCC), David Rogers (Blacktower) and Ronan McGuire (Golf the Costa).
The Vice Consul for Malaga graciously attended the event, and as well as the dinner, entertainment, price giving and networking opportunities the evening was also to provide a forum to raise funds for Age Concern a charity which the Chamber and also the Consulate support.
Over 1400 Euros was raised and so many many thanks go to those generous people who contributed. As well as the main sponsors Blacktower and Ronan of Golf the Costa, thanks also goes to the other sponsors Megacall, Talk Radio Europe, Sovereign Trust , Aer Lingus, Marriotts Vacation Club,Mundo Fitness .
“We know that we live in difficult times and so it was so we really did appreciate the support of the Blacktower Financial Management and our other sponsors who helped to make the day even more special “ said Jennie Thomson Vice President for the BCC Spain Andalucia. “ It was also very heart warming to raise such a sum for Age Concern and for the Vice Consul Rosslyn Crotty to be there with us. I cannot wait for the 2012 event for which you should all start booking with Golf the Costa now.”
25 Year Celebration
Blacktower Financial Management, who this year are celebrating 25 years of helping clients with their financial needs, Mapro Real Estate and Formosa Interior Design, were delighted with the success of their Cocktail Party held on Tuesday 19th April at Edificio Mapro Estrada da Quinta do Lago. Despite the weather forecast it turned out to be an enchanting evening enjoyed by all. On behalf of all three companies both John Westwood and Suzana Bento would like to thank all our clients and guests for a superb turnout making the evening a real night to remember. The guests included clients, friends and local and international business people, who were entertained with jazz music and catered for by Chef Paul and Margo from Food For Thought with mouth-watering canapés and cakes and an outstanding cocktail bar, where two mixologists were kept very busy and the Lychee Martinis went down a treat. The wine was supplied by Prime Wine and helped to toast away the evening. All concerned worked very hard to make sure everything ran smoothly, and to quote one of the testimonials it obviously paid off: “Perfection is often difficult to achieve but you certainly surpassed this yesterday evening – one of the best business cocktail evenings in many years”.
BRICs: An Investment Option
Still the dominant force in emerging markets
“Although smaller emerging markets were the high flyers in 2011, there is a strong case for BRIC countries to perform strongly in 2011”
The BRIC countries – Brazil, Russia, India and China – have been the dominant force with emerging markets for years, both from an economic perspective as well as with regard to stock market performance. The have left a legacy for other emerging markets to follow but are they able to add to this legacy over the coming years? In 2010 their smaller siblings in the wider emerging markets universe stole the show. Thailand saw 60% growth, Peru 58% and Chile 48% whilst the bigger BRIC countries on aggregate ‘only’ returned 17%.
Bullish on Brazil
Brazil has seen in 2010 the election of a new government and subsequently a new Prime Minister in the shape of Dilma Pousseff. Despite a smooth transition of power and the continuation of the successful policies applied by her predecessor, the equity market did experience a degree of uncertainty prior to the election, which alongside the stock overhang created by the 70billion USD capital increase of Petrobas, has brought further market pressure. Tightening monetary policy by the Brazilian central bank, initially as a reaction to a strong economic boom in the first half of 2010 and later curtail inflationary expectations, has also put a cap on the market. However, consumer and business confidence remain strong with Brazilian unemployment remaining at its lowest rate for 30 years (at 6%). Given this, the muted performance in 2010 has resulted in attractive valuations in the market combined with good earnings growth meaning Brazil should remain a key position in a well-balanced investment portfolio.
Rally in Russia
Russia has the lowest valuation compared to all the BRIC countries against its own history and its recent rally is strongly driven by the increase in oil prices. This translates into good earnings support for the overall Russian equity market, strong budgetary revenues for government and it also drives business investment. I think oil prices will remain at elevated levels as a result of the strong global economic backdrop throughout 2011.
Interesting India
The Indian equity market was the star performer within the BRIC countries appreciating by 24.8% in USD in 2010. It continues to provide the best long-term consumption story within emerging markets, as it has a very young population aspiring to achieve the same living standards as we have in Europe. However, a disastrous monsoon in 2010 and a miserable crop harvest mean food inflation has rocketed. The resulting inflationary pressures have urged the central bank to tighten monetary policy. Together with somewhat rich valuations reached in the fourth quarter of 2010, this has resulted in a major market sell-off over the past two months resulting in a number of fund managers moving to a ‘underweight’ position. However, general consensus is that inflationary pressures will abate in the second quarter of 2011 and should result in renewed investor interest.
Cautious China
China has begun the implementation of the new five year plan focusing on growth at a sustainable rate. A greener economy and stimulation of domestic demand are also key targets within the new plan. On the downside, continued strong growth numbers keep fears of inflation and asset bubbles alive. It could be said that these fears are overly bearish. Inflation is led by food prices and it is expected that inflation will peak in the second quarter of 2011. While property prices have risen considerably in some areas, the property market as a whole is not in a bubble territory as average prices have been rising in the past years in line with real wage growth. As the new five year plan will drive growth in various new industries a number of the fund managers we deal with see a neutral risk reward outlook for the market.
The strong rally in emerging markets in 2010 was led by many smaller markets. It is generally considered that 2011 is going to see a catch up of the big markets as well as the large cap stocks. Many of the problems in developed markets such as sovereign over indebtedness, fragile banking systems and vulnerable property markets remain unresolved. The economic backdrop in emerging markets remains much more solid with the expectation of current inflationary pressures. As it is felt that food inflation in emerging markets will abate towards the middle of the year, it will become even more apparent where investors can find long-term sustainable growth. Their focus will return to the most attractive places within emerging markets, which lead the transformation from emerging to developed markets. You may well find these places in four letters – BRIC.
'This facility is not suitable for all expatriates, and we recommend that advice is sought before one makes any commitment. As an Independent Financial Adviser, Blacktower seeks to ensure that our clients receive the advice suitable for their specific circumstances. Please contact us for further details 289 355 685'
Government announces changes to EPC legislation
The government has announced that with effect from 1st July, 2011, the following changes will be made to the EPC legislation under the Energy Performance of Buildings Regulations. These changes will affect all properties put on the market for sale or rental after this date.
- The EPC will now be required within 7 days of the start of marketing for all properties put on the market after 1st July.
- Trading Standards Officers will have increased powers of enforcement to ensure properties being marketed have an EPC in place. These powers to require production of the documents will be extended to include persons acting on behalf of the seller or landlord – e.g. estate agents and letting agents.
- Agents in both the residential and commercial market will be responsible for ensuring an EPC is available.
- From 1st October, 2011, all agents must ensure that the full EPC is included in all marketing material, including the sales particulars.
Guide to changes in contribution and pension benefits
To help identify how changes to the rules governing pension contributions and benefits will affect your clients’ SIPPs with effect from the 6th April, we have produced a guide which we believe provides a concise summary of the changes.
Key details at a glance
- The Annual Allowance for pension contributions reduces to £50,000
- Anti Forestalling for high earners (those with earnings of £130,000 or more) will cease
- Carry forward of unused Annual Allowance for the previous three tax years will be introduced
- Requirement to take benefits by age 75 will come to an end.
- Pension Commencement Lump Sum – the tax free lump sum – will not have to be taken by age 75.
- For those currently receiving an income as Unsecured Pension (USP), the new Capped Drawdown Limits will take effect on particular dates.
- For those currently receiving an income as Alternatively Secured Pension (ASP) new drawdown limits will come into effect under ‘Capped Drawdown’ rules from 6th April 2011. It will be possible to take an income between 0 -100% of the calculated amount. This will be calculated annually on the existing review date.
- Flexible Drawdown’ is available to those who meet certain requirements such as a Minimum Income Requirement (MIR) of £20,000
Options relating to death benefits will remain unchanged, however the tax charge on lump sum death benefits will be 55% if you are in drawdown or over 75 (whether you are in drawdown or not), otherwise if you die before taking any benefits and are under the age of 75, it will be tax free.
Scheme Pension & Flexible Drawdown
The original draft legislation in December 2010 included scheme pension from small schemes as “relevant income” under the “minimum income requirement”. However, secondary legislation published at the same time as the Finance Bill has excluded scheme pension from the definition for schemes with less than 20 members. This means that Family SIPP and SSAS arrangements will not be able to benefit from the anticipated additional flexibility.
There is however still plenty of opportunity for using scheme pension within a Family SIPP or SSAS to provide higher incomes for older clients or those with serious health issues.
International Life Cover
We are pleased to announce that we now have a provider that can provide policies with up to a 40 year term.
The policies can be provided for people in the majority of countries throughout the world in a variety of currencies. The policies have guaranteed premiums throughout with terms of up to 40 years, subject to a maximum age of expiry of 75, using specialist insurers.
Contact your local office to find out more.
QROPS - New Zealand Closing
QROPS - New Zealand Closing
The Directors of the company promoting the Southern Star Retirement Fund have decided to withdraw from the international QROPS marketplace and the Southern Star Retirement Fund (Fund) will be wound up with effect from June 30, 2011.
This decision was taken after a review of the scheme’s recent member expectations and the value proposition we offer. The Directors also believe there is considerable uncertainty regarding the future of the present QROPS transfer system and have an expectation of changes being put in place by regulators which are likely to strengthen the retention requirements for members of New Zealand retirement schemes.
However, all applications received up to April 5, 2011 will be considered, which is the end of the United Kingdom tax year. But, applications received from potential members with less than 5 years membership will not be accepted due to anticipated complications which might arise upon the payment of a winding up benefit later this year.
The Directors felt that the best time to cease taking new members would be April 5 to coincide with the end of the United Kingdom tax year.
We appreciate this is very short notice but a decision had to be made and it was felt that the date elected was the most appropriate.
Please be assured that all contributions remain securely held in the Fund and will be distributed in accordance with the Fund trust deed and New Zealand legislation. The Fund continues to be registered and regulated by New Zealand authorities and this will remain the situation until all money in the Fund is distributed on winding up.
UK Budget Tax Tables
UK Budget March 2011 Tax Tables available for download as pdf. If you require a copy sent to you please contact us.
A Quick Guide to Pension Reform
A Quick Guide to Pension Reform - For details go to our Blog page.
Bank of England Base Rate Remains at 0.5%
Bank of England maintains base rate at 0.5% - 10/03/2011
UK Tax Tips to Save You Money
UK tax tips to save YOU money...
It is that time of year once again – the filing deadline for the 2009/10 tax year has only just passed and we are now rushing headlong towards the end of the current UK tax year. This tax year is the first that the 50% tax rate will bite and as such, it is likely that you will only now be realising what this increase in rate may mean!
As ever, the key to sound tax planning is ensuring that the non-contentious reliefs that are available are being utilized. Are you using your personal allowance, capital gains annual exemption and your ISA subscription?
If you have surplus income, and this is a recurring theme, is there the opportunity for you to undertake inheritance tax planning to use up this surplus income and ensure that your chargeable estate does not increase? Is now the time for you to look at a nil rate band trust?
Charitable gifts are a popular way to minimising a tax liability – an often overlooked point is to ensure that if you are a married couple making a charitable donation and there is a discrepancy in your tax rates, that the higher rate taxpayer makes the gift to ensure that the relief can be claimed.
VCTs, EIS
Tax efficient investments such as venture capital trusts and enterprise investment schemes are always useful to minimise a tax liability.
You must be comfortable with the level of investment risk you are taking and the lock-in period, but from a purely tax perspective, these are attractive offering 30%/20% upfront income tax reductions respectively. It is also worth noting that EIS investment can be made after the end of the tax year and carried back if you do not get around to making the investment before April 5th.
The pension rules have changed again in this tax year, so it is worth checking to ensure you have maximized your available relief as far as you can afford.
The rules change from the 6th of April so although the rules have become less attractive in terms of relief on pension contributions, the tax-free environment offered by a pension wrapper is still appealing.
If you have benefits tied up in an employee benefit trust, the consultation period following the draft changes has now closed and we await the final legislation with interest. Currently we would advise you to do nothing and wait to see what the changes to the draft rules will be.
There may be a limited planning window between the publication of the updated changes and the beginning of the new tax year, so if you are affected you should be reviewing your position now and thinking about what you wish to do with funds comprised within this type of structure.
For non-domiciled individuals, if you have chargeable gains to remit, have you reviewed your affairs – there may be scope to remit gains now and pay 18% capital gains tax rather than 28% if remitted in the next tax year.
Similarly, for trustees of non-resident trusts, if gains are treated as arising to a UK resident settlor or beneficiary (under the anti-avoidance provisions) is there scope for these gains to be realised and distributed before the end of the tax year to crystallise a gain at 18%?
Timing is key at the end of the tax year – if you are looking to realize gains you should consider the timing of any disposal – a disposal on 6 April gives an extra year before the tax is payable, which can be valuable for cash-flow planning.
Individuals looking to leave/return to the UK should be mindful of the tax year – whilst some of the tax rules follow day counting, rules such as the deemed domicile provisions look at tax years of residency.
Waiting until after the start of the new tax year will give someone moving back to the UK extra time before they are treated as deemed Domiciled in the UK in the future.
'This advice is not suitable for all expatriates, and we recommend that advice is sought before one makes any commitment. As an Independent Financial Adviser, Blacktower seeks to ensure that our clients receive the advice suitable for their specific circumstances.
For further details please email: info@blacktowerfm.com or contact your local Blacktower Office.
Use it or lose it
USE IT OR LOSE IT
THE END OF THE 2010-11 TAX YEAR AND THE NEW TAX YEAR APPROACHES
At the end of this tax year rapidly approaches, we would like to offer clients an opportunity to maximise investment of their ISA allowance. Similarly, clients may wish to subscribe early for the ensuing year. Although Investment Markets have recovered and largely appear to have stabilised, returns on cash remain low. An investment made now should be regarded for periods of longer than four years i.e. for the medium to longer term.
Each UK resident over 18 is entitled to invest up to £10,200 into a Stocks and Shares ISA, less, however, if they have purchased a cash ISA this year, and £10,680 next year, plus any charges and client agreed remuneration. Clients should also be aware they may transfer any existing ISA (including Cash ISA) to a Skandia Stocks and Shares ISA, should they wish.
If you would like to discuss whether or not you should invest in an ISA now and which funds you should invest in, please phone for a chat (+ 44 1372 844344) or drop us an Email, with a preferred contact number and time for us to call you.
We propose providing a significant discount to investors purchasing their ISAs this year and for the next Tax Year before 21st April 2011 as there are economies of scale, to us, because there are a number of broadly similar simultaneous transactions.
As there are only about 3 weeks, before the end of this tax year, you need to act, quickly. The latest realistic date for us to receive cheques for this Tax Year and process them is Thursday, 31st March 2011, or for next year, to receive the discount, 21st April 2011.
Any funds selected may fluctuate in value, and any return is not guaranteed as the value of your investment may fall as well as rise.
Blacktower Guide to QROPS (Qualifying Recognised Overseas Pension Schemes)
QROPS - To find out more information please download our brochure.
£10,000 free life cover for new Parents
£10,000 Free Life Cover for New Parents in the UK - We know how much a new baby can change your life and with so much to think about, life cover is perhaps the last thing on your mind. Let's be honest, £10,000, whether free or not, is nowhere near enough, but as a start, help is at hand with this unique offer of £10,000 free life cover.
The policy is available to both new parents who have a baby up to six months old and will last until your child's first birthday. If you have more than one child, you can arrange free cover in respect of each child. There are of course, some terms and conditions, but no hidden costs or charges, and no need to provide bank or credit card details.
Why not give us a call to find out further details on 01372 844344.
Confusion over Mortgages
Confusion over the right mortgage for you. Why not talk to one of our friendly experienced mortgage advisers who will be able to help you through the many different types of mortgages on offer and find the one most suitable for you. We are happy to help First Time Buyers and explain the complicated processes involved in purchasing their first house and help you from beginning to end. We will take the stress and strain of purchasing or re-mortgage a property off your shoulders, so you can relax in the knowledge that everything will run smoothly. So why not contact us at info@blacktowerfm.com or call your local office for more information.
New Government New Taxes
The coalition statement agreement as indicated there could be important announcements about CGT, income tax, national insu8rance, IHT, corporation tax and capital allowances in the forthcoming "emergency" budget. See attached summary of how tax policies may be affected. Contact Blacktower for more information.
Capital Gains Tax Reforms
Increase in Capital Gains Tax likely with new Conservative-Liberal Democrat coalition Government. Contact our Advisers at Blacktower to find out how this could effect you.
80% Buy to Let Mortgages Return
80% Buy to Let Mortgages Return - Contract Blacktower for further information & see latest mortgage rates.
First Time Buyer Stamp Duty Exemption
First time buyers purchasing properties worth up to £250,000 will no longer have to pay stamp duty. So parents who are home owners (or previously owned a home) can't buy together with their children as joint purchasers to help them get on to the property ladder, if they want to take advantage of this new stamp duty exemption. There are however other ways that parents or guarantors can help, so why not contact one of our Mortgage Advisers at Blacktower to find out more. - 01372 844344.
Blacktower E-Magazine - Spring 2010
Blacktower E-Magazine - What's next for the Global Economy - Gibraltar, A Rock Solid Investment - Retirement Age, The New UK Pension Rules - Prnciples & Profits
mygazines.com/issue/8443It's time to review your tax planning and investments
Tax Planning & Investments - It won't be too long before we start thinking about longer, warmer days and getting out into our gardens once again. And with spring comes your last opportunity of the financial tax year to contribute to your ISA. Make sure you don't wait until the last minute!
Stamp Duty Threshold
The stamp duty threshold was increased on 3 September 2008 to £175,000. We thought it would be a good time to remind you that on the 1st January 2010 the threshold will revert back to £125,000, unless the Government extends the concession. That means that if you buy a property and the purchase price is £125,000 or less you will not pay any stamp duty.
Long Term Care & Equity Release Newsletter
Long Term Care & Equity Release Newsletter for the UK
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