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Jan 112017
 

Getting married

Getting married or entering into a civil partnership is a very exciting time, but it’s also a time to start thinking about your finances and how things will change once you are married.

Whatever your situation was as a single person, when you get married you take on new responsibilities and so it’s a good idea to make sure both of you have a strong focus on your personal finances.

There are often big decisions to be made such as choosing a mortgage and deciding who’ll pay the bills (if you’re not already living together).  There are simple things that need to be done too, like changing your name on bank accounts and life assurance policies.  With the help of an independent financial adviser (IFA), you can make a structured plan that will help you cope with your finances as a couple.

We can give you expert guidance on a whole range of issues, from securing your assets outside the marriage, to helping with pension planning, or finding ways to spread to cost of your wedding.  In every situation, getting a little professional advice before you walk down the aisle is a good idea.

Questions you might like to ask us…

  • What’s the best way to organise our savings for tax-efficiency?
  • What are the implications of having our house in joint names?
  • Can we set up life assurance policies on each other?
  • How could we benefit from making pension plans together?

Your ISA Guide 2016/17

 

Don’t know your ISA from your NISA? Wondering what the difference is between a cash ISA and stocks and shares?

Read our beginners guide below and find the answers to your most commonly asked questions.

What is an ISA?

An ISA (Individual Savings Account) is a form of tax-free savings account designed for savers to hold cash or investments.

An ISA gives you a tax-free allowance each year. With a standard savings account, you are taxed on the interest that you earn.  With a tax-free ISA all the interest that you earn is yours to keep.

I keep seeing the term NISA?  Is this different?

ISAs have been around since 1999, but in July 2014 the government changed the rules as to how much you are entitled to save and the format in which you can invest.  These accounts are now known as New Individual Savings Accounts or NISAs, however to ease confusion we’ll still be referring to them as ISAs.

What is the 2016/17 ISA Allowance?

From 6th April 2016 the new tax year starts. The ISA allowance for the 2016/17 tax year will remain the same at £15,240.

The options for how to use your allowance are:

  • Save up to the allowance in a Cash ISA (you may only save into one Cash ISA however with NatWest you can also split the amount between a Cash ISA and Help to Buy: ISA)
  • Invest up to this amount in a Stocks & Shares ISA
  • Invest up to this amount in an Innovative Finance ISA (a new type of ISA for peer to peer lending)
  • Split your allowance between a Cash ISA, Stocks & Shares ISA and a Innovative Finance ISA (For example: Pay £10,000 into a Cash ISA and £5,240 into a Stocks & Shares ISA)

Are there different types of ISA?

Cash ISAs: A cash ISA is similar to a standard bank or building society savings account, the difference being that it enables you to earn interest tax-free.

There are various different types of cash ISA available, including instant access accounts and fixed-rate accounts.

Stocks and shares ISAs: This type of ISA can hold a range of funds, individual shares, government bonds and corporate bonds.  As with any stocks and shares investment this carries an element of risk and returns aren’t guaranteed – there is even a chance that you may lose money.  However, statistically, you are likely to achieve a higher return on your investment in the long-term as opposed to saving in a cash ISA.

You can use your allowance however you please – you could choose to invest the full amount in a stocks and shares ISA or place it all in a cash ISA.  Alternatively you can split your allowance between the two, it’s completely up to you.

Who is eligible for an ISA?

Anyone who is resident in the UK for tax purposes is entitled to hold an ISA.  You must be 16 or over to hold a cash ISA and aged 18 or over to invest in a stocks and shares ISA.

As the name suggests an ISA is for individual savers only, you cannot hold an account jointly with another person, or on behalf of someone else.

How much will an ISA cost me?

You don’t need to pay anything to open a cash ISA – although some accounts may expect a minimum deposit.  The most important thing is to find an ISA with a competitive rate of interest to give you the best return on your money.

With a stocks and shares ISAs you’ll likely incur a set up fee (usually a flat-rate) and often an annual charge (usually a percentage of your current investment).  You’ll also face charges for buying and selling funds so it’s important to look for a low charge if you are going to be actively trading funds.

How do I open an ISA?

ISAs are available from a range of providers including banks, building societies, credit unions, friendly societies and stock brokers.   Some accounts can be opened in person, others operate online only.

Use a comparison site to view the different types of ISA available from a range of providers.

Can I withdraw money from an ISA?

ISAs work best for savings over the long-term because of the compound interest i.e. earning interest on the interest, so if you can avoid making withdrawals this will help you to make the most of your money.

Some Cash ISAs will allow you to lock your money in for a certain period of time – and often these will give you a better rate of interest than easy-access accounts.  These are designed to avoid temptation as if you do make a withdrawal you are likely to face a penalty charge for doing so, and may lose out on any bonuses that the account offers.

However if you are using your ISA as a rainy day fund, there are going to be times when you need access to your money at short notice.  Look for an account that gives you the flexibility to do so without incurring penalty charges, the only downside being is that the rate of interest you receive may not be so good.

I already have an ISA but my rate has dropped. Can I transfer to another ISA?

Yes, you can transfer money in your ISA to another provider at any time but you should always check with your current provider that there aren’t any restrictions in doing so (i.e a charge).

In order to move your ISA whilst still enjoying your full tax-free allowance, you’ll need to fill in an ISA transfer form – your new provider will be able to provide this for you.

Is there an ISA for children?

Yes, there is. In 2011 the government introduced Junior ISAs to replace the now defunct Child Trust Fund.   The tax-free allowance in 2015/16 will be £4,080.

Any child under the age of 18 is entitled to hold a Junior ISA.  Parents or guardians can open the account and make regular deposits, however the money belongs to the child and therefore parents can’t make any withdrawals.  Children can take control of the account when they reach the age of 16, although they cannot withdraw any funds until they are 18.

On your side with Buy to Let

 

First time Buy to Let help

Buying property to let as a long-term investment or to generate a regular income has become an increasingly popular option over recent years, and the demand from would-be tenants for quality rental property continues to grow in many areas of the country.

If you’re planning to develop a substantial portfolio as a professional landlord – or you’re just thinking of a fairly modest investment for the future – you’re almost certainly going to need finance in the form of a Buy to Let mortgage. At Mike Oliver Associates, we’re a leader in arranging Buy to Let mortgages, specialising in finance for the residential letting industry.

We’re ready to help you achieve your goals.

Helping you get it right

As Independent Financial Advisers, we’d like to help you establish and run your Buy to Let business successfully and fairly for all concerned. That means careful planning of finances, taxation, and insurance.  It’s also important that you comply with all of the legal requirements of being a landlord. Ask for our mortgage pack which answers many of the most common questions that arise when would-be landlords first consider investing in Buy to Let – it should work as a sound introduction to the business. However, you’re likely to have specific questions relating to your property, locality and circumstances, and we would be delighted to assist you.

Purchase costs

Deposit

If you are funding your puchase with a mortgage you will need to find a deposit from elsewhere. A typical Buy to Let mortgage is currently available at a maximum of 75% loan-to-value, so it’s likely you will need to fund a quarter of the property value.

 Our arrangement fee

For mortgages we can be paid by commission, or a fee of usually £600, or a combination of both.  This is charge is usually split, so it’s easier to pay; we charge a non refundable fee of £300 upon application and once we receive a suitable offer from a mortgage company a further £300 for the mortgage administration of your case. We appreciate your custom so we’ll reduce your mortgage fees by 50% if you come back to us with repeat mortgage business.

The Financial Conduct Authority does not regulate some aspects of Buy to Let mortgages.

Other costs  

Preparing your property for rent – depending on the condition of the property you intend to Buy to Let, you may have to do structural or decorative work.

You’ll also have to budget for furniture and appliances if you intend to let your property furnished.

Other costs will include legal fees, stamp duty land tax (if appropriate) and a survey fee.

Mortgage costs

Mortgage interest payments are likely to be your largest ongoing cost, and most lenders will want to ensure that the rental you earn from letting your property easily covers your mortgage commitment.  Rental income should be at least 125% of the mortgage interest at initial product, this provides a safeguard against periods when your property isn’t let, and should help you meet the costs of running your property.

Your home or property may be repossessed if you do not keep up repayments on your mortgage and any other debts secured on it.

Running costs

Property maintenance –such as repairs and maintaining the safety of gas and electrical appliances.

Insurance – specialist buildings and contents insurance for landlords is essential. In addition, some insurers will also provide rent guarantee insurance.

Service charges and ground rents – for leasehold properties

Your tenant will normally be responsible for other property related costs such as council tax, a TV licence and utilities. The tenancy agreement should clearly set out who is responsible for each of these payments.

Letting Agent services and charges

If you’re new to the Buy to Let market, have several properties, live some distance from your property or you have other demands on your time, it could make sense to use a reputable letting agent. Naturally the fees or commission you pay to an agent will eat into your profit, but it may save you a great deal of trouble. An agent can be a great source of advice, and it’s worthwhile speaking to local agents who know your area before you buy. A good letting agent will market your property, select tenants, take up references and credit checks, compile inventories and tenancy agreements, collect rent and deposits, and generally inspect and manage the property.

Typical letting agent charges are around 10–15% of the monthly rental. In addition there can be a one-off set up fee. These charges vary from agent to agent, so it may be worth shopping around.

Cost and Income

Your income

Your main source of Buy to Let income will be rent. It is vitally important that you get a true sense of likely rental levels by speaking to local estate agents and generally researching the local rental market. You’ll also be interested in the potential resale value of your Buy to Let property. Therefore the local market, employment opportunities, transport links, schools and other amenities will be important considerations.

Your obligations to the tax man

Tax is payable on the profits you make from letting your Buy to Let property. It’s normally calculated on the gross annual rental income, less any allowable expenses incurred as a result of renting out the property, as well any other allowances that you’re entitled to. If you lose money in any one year, you should be able to carry the loss forward and set it against profit you make in subsequent years.

As a landlord, you’ll have to submit your rental income on your tax return, so it’s vital you keep detailed records of the rental payments you receive as well as all the expenses you incur. It’s standard practice for a landlord to employ an accountant to ensure HM Revenue & Customs are properly advised – and to make sure that all allowable expenses are identified so you can offset them against your profit. Although using an accountant will cost money, the fees you pay for the service will be tax deductible, and the help you’ll receive could easily save you money in the long run.

Expenses which can normally be deducted from your income to calculate your profit include: utility bills, insurance, mortgage interest, maintenance and repair (but not improvements), professional fees, cost of services like cleaners and tradesmen and other expenses such as advertising for tenants.

Sale proceeds and tax

If and when you decide to sell your Buy to Let property, the proceeds from the sale will be subject to capital gains tax. Calculating this tax liability can be quite complicated and it’s almost certainly worth paying for the expert advice of a qualified accountant.

Further information on taxation and allowances can be found by visiting the HM Revenue & Customs website at www.hmrc.gov.uk.

Tenancy agreements

A tenancy agreement is a contract between landlord and tenant. It is most likely to be an Assured Shorthold Tenancy agreement (AST) regulated by the Housing Act 1988 as amended, and provides limited security of tenure to the tenant. Although the content varies, your tenancy agreement should cover:

• details of the parties involved

• The date that the tenancy began

• The duration of the tenancy

•  details of the initial deposit that the tenant should pay  and how it is to be protected

•  details of the monthly rent, when it is due and how it  is to be paid

•  The length of notice that the tenant and landlord need  to give to end the tenancy

• details of the tenant’s obligations while renting the property

•  a provision confirming that the tenant is not liable  for fair wear and tear to the property

 The tenancy agreement should be signed by the tenant and the letting agent, or the landlord if no agent is involved. It can subsequently be changed if both parties agree. Unless you have considerable experience already, it’s a good idea to seek advice from a letting agent or legal adviser on the terms of the proposed tenancy agreement. Initial deposits
An initial deposit should cover you against missing items, or any damage caused by the tenant.

Landlord Obligations

Deposit protection schemes

Tenancy Deposit Protection (TDP) schemes guarantee that tenants will  get their deposit back at the end of the tenancy. (However, the tenant is  still obliged to meet the terms of the tenancy agreement and must not damage the property.)

Landlords are legally required to protect deposits on tenancies which began after 6 April 2007, it’s good practice for landlords to protect deposits in all circumstances. If you don’t protect you tenant’s deposit you could be taken to court. You could be required to repay the deposit plus a sum equivalent to three times the amount, and you may not be able to seek possession of your property. Tenancy Deposit Protection schemes do not cover holding deposits

Types of scheme

There are two types of Tenancy Deposit Protection schemes and you  should seek professional advice – for example from an agent or solicitor –  on what’s the best for you:
•  Custodial – the Deposit Protection Service provides the only custodial  scheme. It holds the deposit in a bank account and returns it at the end  of the tenancy to the person who is entitled to it. This scheme is free to landlords and letting agents.
•  Insurance based – where you or your agent holds the tenant’s deposit  and pays a fee to insure it against default. My Deposits and Tenancy  Deposit Scheme are insurance based providers.

Landlord insurance

Standard home insurance doesn’t normally pay out when a property is let, so it’s important that you arrange a specialist policy. As well as insuring the building and any contents that belong to you, landlord insurance often provides legal cover which could help in disputes. Many policies also include other valuable cover like:

•  Rent guarantee cover – helps protect you against a tenant failing to pay  rent, or if something unexpected happens to make letting impossible.

•  Landlord liability cover – this can protect you against large compensation claims arising from an injury caused by a defect in your property.

Your tenants will be responsible for insuring their own personal possessions.

Landlord repair and maintenance obligations

The Landlord and Tenant Act 1985 covers the three main areas of  your responsibility as a landlord under an assured shorthold tenancy.

Repair

You must keep the structure and exterior of the property in a good  state of repair. You have final responsibility for ensuring your property  is safe and fit for use, and you must ensure that all necessary repairs  are carried out properly.

Gas and electrical safety

As a landlord, you’re responsible for the safety of gas installations and appliances. You must arrange an annual safety check and keep proper records. There are also regulations covering the safety of electrical installations and appliances. Though not currently compulsory in all properties, it makes extremely good sense to fit carbon monoxide and smoke detectors in all let properties.  As a landlord, you must also keep up to date with changes in relevant legislation – it’s your responsibility to find out when your obligations change.

Fire safety of furnishings

You must ensure that any soft furnishings and fittings you provide comply with the relevant standards for fire safety, and it’s a good idea to seek independent advice on your legal responsibilities in this area.

Ending a tenancy

At the end of an Assured Shorthold Tenancy (AST) you have an automatic right as a landlord to possession of your property as long as you’ve given  the tenant two months’ notice to vacate the property.

If the notice period expires and the tenant has still not left the property,  you will need to start the process of eviction through the courts. You can’t forcibly remove a tenant without an eviction order.

If you wish to seek possession under an Assured Shorthold Tenancy because your tenant has not paid the rent, or if they’ve broken other terms of the agreement, you’ll need to use one of the reasons or ‘grounds’ for possession specified in the Housing Act 1988. You will have to seek independent legal advice on bringing an AST to an end.

There are certain criteria that are  applied to all applications for Buy to Let borrowing, as Financial Advisers we are happy to explain any points  relating to your own circumstances.

Tax Tables 2017/18

 

Tax Tables 2017/18

 

The figures contained in these tax tables are based on those announced in the 2017 Budget and may be subject to changes as the Finance Bill passes through Parliament.

Please note income tax thresholds and rates are those applicable in England, Wales, and Northern Ireland.

V1 – 08/03/2017

 

Income Tax 

ALLOWANCES

 

Personal Allowances 2016/17 2017/18
Personal Allowance £11,000 £11,500
Income limit for Personal allowance(1) £100,000 £100,000
Transferable Tax Allowance for married couples and civil partners (2)   £1,100 £1,150
Dividend Allowance   £5,000 £5,000
Personal Savings Allowance (3)   £1,000 £1,000
Married Couples Allowance (MCA) 2016/17 2017/18
Maximum MCA (4) £8,355 £8,445
Income limit for the MCA (5) £27,700 £28,000
Minimum MCA £3,220 £3,260
Blind Persons Allowance 2016/17 2017/18
  £2,290 £2,320

(1) Personal allowance reduced by £1 for every £2 that adjusted net income exceeds the £100,000 threshold. Reduced to zero once adjusted net income reaches £122,000. (2) Available to spouses and civil partners born after 5 April 1935. The recipient must not be liable to tax above the basic rate. (3) Reduced to £500 for higher rate taxpayer and £Nil for additional rate taxpayers.

(4) Can be claimed by individuals born before 6 April 1935. Tax relief for the MCA is 10% and is given as a tax reducer. (5) MCA is reduced by £1 for each £2 of gross income above the income limit (£28,000 in 2017/18) but can’t be reduced to less than the minimum (£3,260 in 2017/18) 

 

TAXABLE INCOME

 

Thresholds 2017/18 Savings Income Dividend Income Non-Savings Income
Starting Rate(1) £0 to £5,000 0% n/a n/a
Basic Rate £0 to £33,500 20% 7.5% (2) 20%
Higher Rate £33,501 to £150,000 40% 32.5% (2) 40%
Additional Rate Over £150,000 45% 38.1% (2) 45%

 

(1) The 0% starting rate is for savings income only. If an individual’s taxable non-savings income exceeds the stating rate limit the 0% starting rate band will not be available for savings income.

(2) These tax rates only apply to the extent that dividend income exceeds the £5,000 dividend allowance.

 

  2016/17 2017/18
Trust Income Dividends Other Dividends Other
Interest in Possession 7.5% 20% 7.5% 20%
Discretionary
The first £1,000 of income 10% 20% 7.5% 20%
Income above £1,000 38.1% 45% 38.1% 45%

 

VENTURE CAPITAL SCHEMES

 

  2016/17 2017/18
Scheme Max Income Tax relief Max Income Tax relief
EIS £1,000,000 30% £1,000,000 30%
Seed EIS £100,000 50% £100,000 50%
VCT £200,000 30% £200,000 30%

 

 National Insurance

 

 

National Insurance – rates and allowances
£ per week 2016/17 2017/18
Lower earnings limit, primary Class 1 £112 £113
Upper earnings limit, primary Class 1 £827 £866
Primary threshold £155 £157
Secondary threshold £156 £157
Employees’ primary Class 1 rate between primary threshold and upper earnings limit 12% 12%
Employees’ primary Class 1 rate above upper earnings limit 2% 2%
Class 1A rate on employer provided benefits 13.8% 13.8%
Married women’s reduced rate between primary threshold and upper earnings limit 5.85% 5.85%
Married women’s rate above upper earnings limit 2% 2%
Employers’ secondary Class 1 rate above secondary threshold 13.8% 13.8%
Class 2 rate £2.80 £2.85
Class 2 small earnings exception  £5,965

per year

£6,025 per year
Special Class 2 rate for share fishermen £3.45 £3.50
Special Class 2 rate for volunteer development workers £5.60 £5.65
Class 3 rate £14.10 £14.25
Class 4 lower profits limit £8,060 per year £8,164

per year

Class 4 upper profits limit £43,000 per year £45,000

Per year

Class 4 rate between lower profits limit and upper profits limit 9% 9%
Class 4 rate above upper profits limit 2% 2%

 

Capital Gains Tax 

ANNUAL EXEMPTION & RATES

 

Annual Exemption 2016/17 2017/18
Individuals £11,100 £11,300
Trustees £5,500 £5,650

 

Main rates for individuals 2016/17 2017/18
Basic Rate 10% 10%
Higher Rate 20% 20%
Rates on gains subject to entrepreneur’s relief 10% (1) 10% (1)
Rates for individuals (gains on residential property) 2016/17 2017/18
Basic rate 18% 18%
Higher Rate 28% 28%

 (1) Entrepreneur’s relief is available on qualifying disposals up to a maximum lifetime limit of £10,000,000.  Gains in excess of this limit are taxed at 20%.

 

Corporation Tax 

Main Rate 2016/17 2017/18
20% 19%

 

*Since 2015/16, there has been a single unified rate for all companies irrespective of the amount of profit they make.

 

*Since 2015/16, there has been a single unified rate for all companies irrespective of the amount of profit they make.

 

Inheritance Tax 

TAX RATES

 

Tax Year Nil Rate Band (1) (2) IHT due on a chargeable lifetime transfers in excess of the NRB IHT due on Death on chargeable transfers in excess of the NRB
2016/17 £325,000 20% 40%
2017/18 £325,000 20% 40%

 

(1)The NRB will remain frozen at £325,000 until 2020/21

(2) When the deceased has been predeceased by a spouse who had not used all of their own NRB on their earlier death, the unused percentage on first death can be transferred to enhance the NRB of the surviving spouse on second death. The maximum percentage that can be transferred is 100% which would double the NRB available.

 

Tax Year Residence Nil Rate Band (1) (2) IHT due on a chargeable lifetime transfers in excess of the RNRB (3) IHT due on Death on chargeable transfers in excess of the RNRB plus any available normal (‘any assets’) NRB (4)
2016/17 n/a n/a 40%
2017/18 £100,000 n/a 40%
2018/19 £125,000 n/a 40%
2019/20 £150,000 n/a 40%
2020/21 £175,000 n/a 40%

 

(1)The RNRB is only available to offset against the value of a residential property that is (or has been previously) used by the deceased as their main residence and which is transferred on death to a lineal descendant, or the spouse or civil partner of a lineal descendant.   (2) When the deceased has been predeceased by a spouse who had not used all of their own RNRB on their earlier death, the unused percentage on first death can be transferred to enhance the RNRB of the surviving spouse on second death. The maximum percentage that can be transferred is 100% which would double the RNRB available.

(3) The RNRB is only available on death – it cannot be offset against lifetime transfers of a main residence. (4)The RNRB, which is in addition to the normal (‘any assets’) NRB, is set off against any chargeable transfers of a main residence before any of the normal NRB is used up.

 

MAIN EXEMPT TRANSFERS

 

Maximum £
Gifts to a UK domiciled spouse No limit
Gifts to a Non UK domiciled spouse £325,000(1)
Gifts to charities No limit
Gifts to political parties No limit
Annual exemption £3,000
Small gifts £250 (2)
Normal expenditure out of income No limit
Gifts in consideration of marriage (see below)
Parents £5,000 each
Grandparents and bride/groom to each other £2,500 each
Any other person £1,000

(1) This £325,000 exemption applies to cumulative transfers. It is therefore necessary to consider previous gifts and transfers to a non UK domiciled spouse in order to determine whether any of this exemption remains.  It is also possible for a non-domiciled spouse to instead make an irrevocable election to be treated as UK domiciled for IHT purposes.

(2) The gift has to be outright; not a gift into trust.

 

IHT RELIEFS

Business or farming assets may attract relief at either 50% or 100%, depending on the circumstances and type of the assets concerned. The relief can apply during lifetime and on death but if the relief is 100%, the practical effect is to make the transaction exempt.

  

Pensions 

ANNUAL ALLOWANCE AND LIFETIME ALLOWANCE

 

Tax Year Annual Allowance Lifetime Allowance
2013/14 £50,000 £1.5million
2014/15 £40,000 £1.25million
2015/16 £40,000 (1) £1.25million
2016/17 £40,000 (2) £1.00 million (3)
2017/18 £40,000 £1.00 million

1) From 6 April 2015, a Money Purchase Annual Allowance (MPAA) was introduced which applies to anyone who accesses their pension ‘flexibly’ on or after this date. The MPAA was £10K in 2015/16 and 2016/17 but reduced to £4K from the start of the 2017/18 tax year.

2) From 6 April 2016, the normal annual allowance is reduced by £1 for each £2 that an individual’s ‘adjusted income’ exceeds £150K. This is subject to a minimum annual allowance of £10K for individuals with ‘adjusted income’ of £210K or more.

3) The lifetime allowance was reduced to £1m from 6 April 2016. To counteract this reduction though, individuals can apply for ‘fixed protection 2016’ to preserve an entitlement to the higher £1.25m lifetime allowance provided (broadly) they do not accrue further pension benefits after this date. Individuals with total pension rights valued at greater than £1m as at 5 April 2016 can also apply for ‘Individual protection 2016.’

 

TAX CHARGES ON PAYMENTS   FROM REGISTERED PENSION SCHEMES

 

Charges Rates 2017/18
Lifetime allowance charge 55% – if the amount over the lifetime allowance is paid as a lump sum

25% – if the amount over the lifetime allowance is taken as income

Annual allowance charge Up to 45%
Unauthorised payments charge 40%
Unauthorised payments surcharge 15%
Short service refund lump sum charge 20% on first £20,000, 50% on any amount over £20,000
Special lump sum death benefits charge No tax charge where member dies prior to age 75

Beneficiary’s marginal rate where death occurs after age 75

Scheme sanction charge 15% – 40%
PENSION CREDIT

 

Guarantee Credit 2016/17 2017/18
Single Person £155.60 £159.35
Married couple £237.55 £243.25

 

BASIC STATE PENSION

 

SPA pre 6 April 2016 2016/17 2017/18
Category A £119.30 £122.30
Category B Supplement £71.50 £73.30
SPA post 6 April 2016 2016/17 2017/18
New single tier pension if got full qualifying years £155.65 £159.55

 

Stamp Duty Land Tax 

RESIDENTIAL

 

Band 2017/18 (existing rates) 2017/18 (Additional property rates)
Up to £125,000 Zero 3%
£125,001 to £250,000 2% 5%
£250,001 to £925,000 5% 8%
£925,001 to £1,500,000 10% 13%
Over £1,500,000 12% 15%

 

COMMERCIAL

 

Band 2017/18
Up to £150,000 Zero*
£150,001 to £250,000 2%
Over £250,000 5%

* Where annual rent is £1,000 or more SDLT will be charged at 1% for commercial land and buildings on values between £0 and £150,000.

 

Individual Savings Account (ISAs) 

ISA   CONTRIBUTION LIMITS

 

Limits 2016/17 2017/18
Overall Limit £15,240 £20,000
Lifetime ISA      n/a £4,000
Help to Buy ISA £2,400 (£3,400 in year 1) £2,400 (£3,400 in year 1)

 

JUNIOR ISA CONTRIBUTION LIMITS

 

Limits 2016/17 2017/18
£4,080 £4,128

 

 

 

 

 

     

 

 

 

 

Dec 042014
 

 

Financial planning and advice is not just for the very wealthy – everyone can benefit from it. Good financial planning can help you achieve your future goals and aspirations and secure you and your family’s long-term future. Here are 10 reasons why you should speak to an IFA.

 

What is an IFA?

No 1: To protect your loved ones

Many people trying to sell insurance of one type or another but an independent financial adviser can tell you which one is best suited should the unthinkable happen. An independent financial adviser will assess your position and guide you through the best options to protect yourself and your family whether you are single, married, have children or they have long left home. Whatever your needs, an adviser can help ensure personal tragedy does not turn into financial crisis.

No 2: To help plan your spending – and saving

To secure your long-term financial future, you need to build some assets, initially to get you through the rainy days and then to pay for those holidays and luxuries. So, step one is to plan your spending so that you can begin to save – and step two is to plan to save so you can build your wealth as efficiently as possible. Regardless of whether you currently have £10 or £10,000, an independent financial adviser will look at your situation and find  the best starting point for you.

No 3: To help you plan for retirement

Once your short term saving needs have been met, you are then in a position to start thinking about your longer term goals. People are becoming more aware that they cannot rely on the State for more than the absolute basics. However, planning for retirement is a complex business and there are many different options available.

Pensions have come a long way in terms of flexibility in recent years and now offer a wide range of investment options. An independent financial adviser will not only help sift through the many rules and product options but can also help construct a portfolio to maximise your long term prospects.

No 4: To buy your home

The mortgage market was complicated enough already, with its discounts and variables, AERs and caps, indemnities and early redemption fees. Then the credit crunch hit and things have got even worse. However, buying a house is still one of the most expensive decisions we make, and the vast majority of us need a mortgage.

An independent financial adviser could save you thousands, particularly at times like this. Not only can they seek out the best rates, they can help you assess sensible levels of borrowing, make the most of your deposit and might also find lenders who would otherwise not be available to you.

No 5: Financial planning

As you progress through life, you begin to build your assets and your income begins to increase. You then start considering how you can enhance your position rather than simply consolidate it. This could mean anything from looking to retire early through to paying school fees for private schools or investing in overseas property.  However your dreams evolve, an independent financial adviser can help assess what is realistically possible – and put the best plan in place to help you achieve it.

No 6: To find the right combination of assets

Investment is as much about protecting the potential downsides as it is about targeting maximum growth. High returns are often associated with high risk – and not everyone is happy if their investment falls by a third or more overnight. An independent financial adviser will make a detailed assessment of your attitude to risk before making any recommendations. They will also ensure you don’t put all your eggs in one basket by helping you diversify not only across asset classes but also across accounts, individual funds and product providers.

No 7: To obtain an objective assessment

Every new product or investment opportunity is accompanied by hype, proclaiming it is the best ever –but that does not mean it is right for you. Investors the world over have been and will continue to be caught out by market bubbles or high charges because they don’t take a step back. A financial adviser knows how products and assets work in different markets and can outline the downsides for you as well as the benefits. Between you, you can then make a more informed decision about what hype you can believe – and what products you really need to avoid.

No 8: To save money

Once your risk and investment assessments are complete, the next step is to look at tax and even the most basic overview of your position could help. It may simply mean using ISAs or a pension plan to benefit from Government incentives or it could mean choosing growth assets over income to use capital gains allowances rather than pay income tax. Alternatively, for more complicated arrangements, it might mean moving assets to your spouse or children to make full use of their personal allowances. An independent financial adviser will always have your tax
position in mind when making recommendations and can help point you in the right direction even in complicated situations.

No 9: To keep you on track

Even when you have every product you need taken care of and your investments are set up and running to plan, someone needs to keep an eye on them in case changes in markets or abnormal events push them off course. You can ask an independent financial adviser to do this monitoring work for you. They can assess the performance of individual investments against their peers, ensure that your asset allocation does not get distorted as markets move and also help you consolidate gains as the dates of your ultimate goals approach.

No 10: For peace of mind

Money is a complicated subject and there are many things you need to think about to both protect it and make the most of it. Markets are volatile and the media is prone to exaggeration of both the risks and the rewards. Employing a good independent financial adviser can take the emphasis away from you and move it into the hands of an expert. Whether you need general, practical advice or a specialist with dedicated expertise, the money you invest in taking advice could be paid back many times over in the long term.

At MOA we believe we believe every client is altogether individual and deserves tailored independent financial solutions. If you would like to benefit from our objective, professional and personal service.

The value of pensions and investments can fall as well as rise, and you can get back less than you invested.

Your home may be repossessed if you do not keep up repayments on your mortgage or other loans secured on it.

For mortgages we charge a fee of at least £600.  We will also be paid a procuration fee from the provider, if one is available.

How to reduce your Inheritance Tax bill

 

How to reduce your Inheritance Tax bill

Mike Oliver Associates Estate PlanningBy Chloe Hayward Business reporter, BBC News

“We all want to see a system where it is only the very rich that pay inheritance tax, and not hard working people.” Those were the words of David Cameron during Prime Minister’s Questions. But despite these intentions an increasingly large number of people will leave their loved ones with a hefty tax bill when they die. The current inheritance tax (IHT) threshold is £325,000 per person. It doubles to £650,000 for a married couple – as long as the first person to die leaves their entire estate to their partner. Anything over this limit is subject to a 40% tax bill. So what sort of people are now having to pay IHT, and if that is likely to include you, how can you legitimately reduce your bill?

‘Unfair’

Property price increases are dragging many middle class working families into the tax bracket.

When do you pay IHT?

• First £325,000 is tax free
• First £650,000 for married couples is tax free
• Thereafter assets taxed at 40%

The average price of property in London is now £514,000, while it has reached £338,000 in the South East. That means many single or divorced people who own their house, will owe tax on their estate when they die. The Office for Budget Responsibility (OBR) calculates that 4.8% of the population currently pays IHT. By 2018-19, it estimates that figure will have more than doubled, to 10%. Bob Dyson has found himself being dragged into the net. In 1987 he bought a house in north London for £115,000. It is now valued at £800,000. He is furious to find out that his daughter might have to pay a six figure sum in tax, should he die in the next few years. “I have been paying income tax on the nose for the last 50 years, and now I find out that I could have to pay tax again on the house. It’s already taxed money. I think it’s a tax on being prudent,” he says.”It’s unfair and the threshold should be raised.”

Reducing tax

But there are options for people who find themselves in Bob’s position. “If you plan ahead you can totally legally reduce your inheritance tax bill,” explains Claire Walsh, a chartered financial planner from Aspect 8 in Brighton.

How to reduce your IHT bill

• Gifts of up to £3000 a year are tax free
• Gifts out of income are tax free
• Get married – your allowance doubles
• Put your assets in a pension. Usually inheritors pay less tax
• Give to charity. Your tax bill will be reduced
• Hand over your house – but you will need to live for seven years, and pay rent

Clearly the best way to avoid paying any tax is to reduce your estate value to below the £325,000 threshold. “Start enjoying your retirement is always the first piece of advice I give,” says Claire Walsh. “I also often find myself telling people to get married as well. Married couples have their threshold doubled to £650,000,” she says. Changes to pension legislation could also offer a way around IHT.As of April 2015 pension pots will no longer be subject to a 55% tax when passed on to loved ones after the saver dies. This means that any funds in a pension pot can be passed onto a named individual without any tax implications if they die before the age of 75. “I would advise clients to consider transferring all their non-pension assets to fund their pension,” says Scott Gallacher, chartered financial planner at Rowley Turton in Leicester. “By shifting your savings into a drawdown scheme they will no longer be included in your final estate valuation, and therefore will avoid inheritance tax,” he advises.

Gifts

You can give up to £3,000 a year in gifts tax-free

Giving gifts is another way to reduce your final estate value. Each year you can give away £3,000 with these gifts falling outside your estate immediately. You can also gift larger sums of money but these will stay within your estate valuation for seven years, another reason why it is good to plan ahead. Assuming you live for seven years, then these gifts fall outside your estate and avoid IHT. A way to safeguard these gifts before the seven year deadline is for the beneficiaries to take out life insurance against an inheritance tax bill. This is especially popular for single parents who do not want children to have to sell the family home to pay a tax bill. In addition, if you have an income – a pension, earnings, or dividend payouts – and you give money regularly, then it is also exempt. And remember gifts to political parties and charities are also free of IHT.

‘Squeezed middle’

Despite all the options available, unless your give your house away, it is hard to avoid inheritance tax on what is probably your most valuable asset. Many argue that the threshold should at least rise each year in line with inflation, but now the rate has been fixed since 2009. The Conservative election manifesto outlined plans to raise the threshold to £1m, citing house price rises. But their Liberal Democrat coalition partners blocked this move.  “The key people who are caught up in inheritance tax are the squeezed middle. These are the people with the bulk of their wealth tied up in the family home,” says Scott Gallacher.

The levels, bases and reliefs from taxation are subject to individual circumstances and may be subject to future change.

The Financial Conduct Authority does not regulate taxation & trust advice, will writing.

Speak in confidence to us on 0845 4021757, or take a look at our Estate Planning Website.

 

 

 

 

First Time Buyer Help

 

Need help with your first purchase?

…….then you’ve come to the right place.

Principal: Mike Oliver, Dip PFS Cert CII(MP & EP) has 25 years industry experience as an Adviser, Area Manager, Financial Services Director and Business Owner.

An initial Consultation is totally free of charge and by using our financial adviser services we can offer a huge choice of mortgages (more than 5,000 schemes at a recent count) to suit your precise needs and we can help you quickly.  We will find you the right scheme, liaise with the lender, surveyor, estate agent and solicitor and we will update you at every stage.

Our Purchasing Your First Property Booklet (PDF)  aims to guide you through the process of buying your first home covering the following steps:

  1. Decide what type of property you’re looking for and how much you can borrow
  2. Additional costs
  3. Register with estate agents and visit properties you like
  4. Make an offer
  5. Offer accepted
  6. The best type of mortgage for you
  7. Instruct your solicitor
  8. Survey and Survey results
  9. Exchange contracts
  10. Organise your insurance policies
  11. Completion

For mortgages we charge a fee of at least £600. We will also be paid a procuration fee from the mortgage provider if one is available.

Your home or property may be repossessed if you do not keep up repayments on your mortgage and any other debt secured on it.

Welcome To:

 

home commercial mortgages pensions protection savings & investments wills & estate planning about us contact us Equity Release Long Term Care & Asset Protection

What You Need To Know

 

what-you-need-to-know

 

The Financial Conduct Authority FCA 11 Principles of Business fashion the code of conduct for our industry.   If we advise you on your assets then we assume a joint responsibility with you to safeguard them in any eventuality. Under Principle 10, as Financial Advisers, we are morally and legally obliged to protect the assets of our clients.

As Financial Advisers we maintain the highest standards of ethics.  To that end we have devoted our time and efforts to producing a charging structure that is fair across all our business areas. We are pleased to support FCA Principle 6, ‘Treating Customers Fairly’.

 

 

 

Your Appointment

 

Tell us about your plans and dreams and we’ll work withchrysalis you to try and turn them into reality

 

What to bring with you

We have created this checklist to give you an idea of what information we will need to help you with your financial planning, and by supplying us with this information at our first meeting, we can start working on your case quickly.

  • List of goals for the financial planning exercise
  • List of specific questions that you want answered

ID/Residence

Proof of name – Current Passport or Drivers Licence

Proof of address – Utility Bill/Bank Statement – dated within the last 2 months showing name and current address

Possible Documentation Requirements:

  • Current Will and Trust documents
  • Buildings and Contents – policy and schedule
  • Life & Critical Illness – policy and schedule
  • Pension policy information
  • Investment information

Information required for Mortgages:

If Employed

Latest 3 months payslips

Latest P60

Latest 3 months bank statements showing salary being credited. Statements must include the bank’s name together with the applicant’s account number and name.

 If Self-Employed

3 years company accounts/self assessment tax returns

3 years HMRC SA302’s with Corresponding tax year overviews – these can be obtained from HMRC, they can be used as proof of earnings and tax paid

If you receive a PAYE salary from your own company then we would require 3 months payslips and latest P60 as well as above

Latest 3 months bank statements. Statements must include the bank’s name together with the applicant’s account number and name.

Additional Documentation

For purchases if not using equity from existing property we will need evidence of deposit funds

Latest Annual Mortgage Statements

For Court Ordered Maintenance payments – a copy of the court order

For Child/Working Tax Credits/Child benefit – Annual letters from HMRC confirming your payments for the following year and corresponding bank statements for the past 3 months showing the payments received

Latest Credit Report

Please sign and return the IDD explaining our costs and services we provide along with the data protection statement attached

 

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