Merry Christmas and Best Wishes for a happy and prosperous New Year to our clients and friends from all of us at PPS.
We close early on Christmas Eve and re-open on Monday 4th January 2016. We look forward to seeing you again throughout 2016!
Wednesday 16 December 2015
Thursday 12 November 2015
Tuesday 7 April 2015
Monday 6 April 2015
Pension consolidation
Mitigating lost investment opportunities, exposure to undue risk and higher costs
Most people, during their career, accumulate a number of different pension plans. Keeping your pension savings in a number of different plans may result in lost investment opportunities and unnecessary exposure to risk.
However, not all consolidation of pensions will be in your best interests. You should always look carefully into the possible benefits and drawbacks and, if unsure, seek professional financial advice.
Keeping track of your pension portfolio
It’s important to ensure that you get the best out of the contributions you’ve made and keep track of your pension portfolio to make sure it remains appropriate to your personal circumstances. Consolidating your existing pensions is one way of doing this.
Pension consolidation involves moving, where appropriate, a number of pension plans – potentially from many different pensions’ providers – into one single plan. It is sometimes referred to as ‘pension switching’.
Pension consolidation can be a very valuable exercise, as it can enable you to:
• Bring all your pension investments into one easy-to manage wrapper
• Identify any underperforming and expensive investments, with a view to switching these to more appropriate investments
• Accurately review your pension provision in order to identify whether you are on track
Why consolidate your pensions?
Traditionally, personal pensions have favoured with-profits funds – low-risk investment funds that pool the policyholders’ premiums. But many of these are now heavily invested in bonds to even out the stock market’s ups and downs and, unfortunately, this can lead to diluted returns for investors.
It’s vital that you review your existing pensions to assess whether they are still meeting your needs – some with profits funds may not penalise all investors for withdrawal, so a cost-free exit could be possible.
Focusing on fund performance
Many older plans from pension providers that have been absorbed into other companies may have pension funds which are no longer open to new investment – so-called ‘closed funds’. As a result, focusing on fund performance may not be a priority for the fund managers.
These old-style pensions often impose higher charges that eat into your money, so it may be advisable to consolidate any investments in these funds into a potentially better performing and cheaper alternative.
Economic and market movements
It’s also worth taking a close look at any investments you may have in managed funds. Most unit-linked pensions are invested in a single managed fund offered by the pension provider and may not be quite as diverse as their name often implies. These funds are mainly equity-based and do not take economic and market movements into account.
Lack of the latest investment techniques
The lack of alternative or more innovative investment funds, especially within with-profits pensions – and often also a lack of the latest investment techniques – mean that your pension fund and your resulting retirement income could be disadvantaged.
Significant equity exposure
Lifestyling is a concept whereby investment risk within a pension is managed according to the length of time to retirement. ‘Lifestyled’ pensions aim to ensure that, in its early years, the pension benefits from significant equity exposure.
Then, as you get closer to retirement, risk is gradually reduced to prevent stock market fluctuations reducing the value of your pension. Most old plans do not offer lifestyling – so fund volatility will continue right up to the point you retire. This can be a risky strategy and inappropriate for those approaching retirement.
Conversely, more people are now opting for pension income drawdown, rather than conventional annuities. For such people, a lifestyled policy may be inappropriate.
Consolidating your pensions won’t apply to everyone
The potential benefits of consolidating your pensions won’t apply to everyone, and there may be drawbacks to moving your pension plans – particularly so for certain types of pension. It is therefore vitally important to carefully consider all aspects of your existing pensions before making a decision as to whether or not to consolidate.
As well as whether the total size of your pension funds make consolidation viable, issues to take into account include whether your existing pensions have:
• Loyalty bonuses
• Early termination penalties
• Guaranteed annuity rates
• Integrated life cover or other additional benefits
• Final salary pension benefits
The value of the investments in your pension fund can go down as well as up. Early investment losses can be particularly difficult or even impossible to recover. If your investments fall in value, you may need to reduce the amount of income you withdraw from your fund. If your investments fall in value, or fail to grow sufficiently, you may not be able to withdraw as much income in future. This information does not constitute advice and should not be used as the basis of any financial decision, nor should it be treated as a recommendation for any product. Although endeavours have been made to provide accurate and timely information, Professional Practice Services cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions.
Professional financial advice you can trust
Many people during their career may accumulate a number of different pension plans, and maintaining these separate plans can be laborious and complicated, leading to lost investment opportunities, exposure to undue risk and higher costs. To find out how we could help you, please contact us for further information.
Call our friendly, knowledgeable team for a confidential, no obligation discussion:
01527 880345
Visit our Website at:
www.pps-vet.co.uk
Article Reference: PPS062014.GM26
Article Author: David Hodgetts
VIP Publication Date: 23/02/2015
Most people, during their career, accumulate a number of different pension plans. Keeping your pension savings in a number of different plans may result in lost investment opportunities and unnecessary exposure to risk.
However, not all consolidation of pensions will be in your best interests. You should always look carefully into the possible benefits and drawbacks and, if unsure, seek professional financial advice.
Keeping track of your pension portfolio
It’s important to ensure that you get the best out of the contributions you’ve made and keep track of your pension portfolio to make sure it remains appropriate to your personal circumstances. Consolidating your existing pensions is one way of doing this.
Pension consolidation involves moving, where appropriate, a number of pension plans – potentially from many different pensions’ providers – into one single plan. It is sometimes referred to as ‘pension switching’.
Pension consolidation can be a very valuable exercise, as it can enable you to:
• Bring all your pension investments into one easy-to manage wrapper
• Identify any underperforming and expensive investments, with a view to switching these to more appropriate investments
• Accurately review your pension provision in order to identify whether you are on track
Why consolidate your pensions?
Traditionally, personal pensions have favoured with-profits funds – low-risk investment funds that pool the policyholders’ premiums. But many of these are now heavily invested in bonds to even out the stock market’s ups and downs and, unfortunately, this can lead to diluted returns for investors.
It’s vital that you review your existing pensions to assess whether they are still meeting your needs – some with profits funds may not penalise all investors for withdrawal, so a cost-free exit could be possible.
Focusing on fund performance
Many older plans from pension providers that have been absorbed into other companies may have pension funds which are no longer open to new investment – so-called ‘closed funds’. As a result, focusing on fund performance may not be a priority for the fund managers.
These old-style pensions often impose higher charges that eat into your money, so it may be advisable to consolidate any investments in these funds into a potentially better performing and cheaper alternative.
Economic and market movements
It’s also worth taking a close look at any investments you may have in managed funds. Most unit-linked pensions are invested in a single managed fund offered by the pension provider and may not be quite as diverse as their name often implies. These funds are mainly equity-based and do not take economic and market movements into account.
Lack of the latest investment techniques
The lack of alternative or more innovative investment funds, especially within with-profits pensions – and often also a lack of the latest investment techniques – mean that your pension fund and your resulting retirement income could be disadvantaged.
Significant equity exposure
Lifestyling is a concept whereby investment risk within a pension is managed according to the length of time to retirement. ‘Lifestyled’ pensions aim to ensure that, in its early years, the pension benefits from significant equity exposure.
Then, as you get closer to retirement, risk is gradually reduced to prevent stock market fluctuations reducing the value of your pension. Most old plans do not offer lifestyling – so fund volatility will continue right up to the point you retire. This can be a risky strategy and inappropriate for those approaching retirement.
Conversely, more people are now opting for pension income drawdown, rather than conventional annuities. For such people, a lifestyled policy may be inappropriate.
Consolidating your pensions won’t apply to everyone
The potential benefits of consolidating your pensions won’t apply to everyone, and there may be drawbacks to moving your pension plans – particularly so for certain types of pension. It is therefore vitally important to carefully consider all aspects of your existing pensions before making a decision as to whether or not to consolidate.
As well as whether the total size of your pension funds make consolidation viable, issues to take into account include whether your existing pensions have:
• Loyalty bonuses
• Early termination penalties
• Guaranteed annuity rates
• Integrated life cover or other additional benefits
• Final salary pension benefits
The value of the investments in your pension fund can go down as well as up. Early investment losses can be particularly difficult or even impossible to recover. If your investments fall in value, you may need to reduce the amount of income you withdraw from your fund. If your investments fall in value, or fail to grow sufficiently, you may not be able to withdraw as much income in future. This information does not constitute advice and should not be used as the basis of any financial decision, nor should it be treated as a recommendation for any product. Although endeavours have been made to provide accurate and timely information, Professional Practice Services cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions.
Professional financial advice you can trust
Many people during their career may accumulate a number of different pension plans, and maintaining these separate plans can be laborious and complicated, leading to lost investment opportunities, exposure to undue risk and higher costs. To find out how we could help you, please contact us for further information.
Call our friendly, knowledgeable team for a confidential, no obligation discussion:
01527 880345
Visit our Website at:
www.pps-vet.co.uk
Professional Practice Services is a Veterinary Business Consultancy and Independent Financial Advisory Firm. Professional Practice Services is authorised and regulated by the Financial Conduct Authority
The Financial Conduct Authority does not regulate finance, will writing, commercial lending, taxation or trust advice.Article Reference: PPS062014.GM26
Article Author: David Hodgetts
VIP Publication Date: 23/02/2015
Wednesday 1 April 2015
BSAVA Congress 2015
Professional Practice Services are pleased to confirm we will be exhibiting again this year at the BSAVA Annual Congress held at The ICC and NIA, Birmingham from 9th -12th April 2015.
Please do come and visit us at Stand 602 for an informal chat about your Practice needs.
Alternatively do let us know if you would like a more in depth conversation as we are offering 1-2-1 meetings throughout Congress.
Your Success is Our Business
The PPS Group provide personal expert financial advice and consultancy services exclusively to the veterinary profession. We've been providing successful financial solutions since 1997. Our team of experienced and knowledgeable staff can guide you through a sometimes unexpected financial minefield.
With personal visits to your practice, no call centres or push button phones, you can speak directly to the people who matter.
Financial Services through Professional Practice Services
- Independent Financial Advice for Practice Owners and Staff
- Retirement/Succession Planning
- Practice Finance
- Business Protection
- Partnership/Share Protection
- Investment/Pension and Wealth Management
- Family Protection
- Income Protection
- Mortgages
- Employee Benefits
- Workplace Pensions
- Business Consultancy
Call our friendly, knowedgeable team from a confidential, no obligation discussion:
01527 880345
Visit our Website at:
Professional Practice Services is authorised and regulated by the Financial Conduct Authority.
The Financial Conduct Authority does not regulate finance, will writing, commercial lending, taxation or trust advice.
Monday 23 March 2015
Maximising the value of your pension pot
Probably the single most important decision to realise your long-term goals
Retirement planning involves thinking about your plans for the future now – that means investing your money with the aim of maximising its value ready for when you retire. Careful retirement planning, the right mix of assets and starting sooner rather than later will help lead to the retirement you are looking for.
Historically, for many people, the traditional view of saving for retirement was to simply put your money into a pension, with few decisions to make in the run-up to your retirement date and no choice over how the pension was taken.
Reviewing your retirement planning
Having a pension today is recognised as just one important step along the path to achieving your dreams once you have stopped working. Now, not only must you carefully consider where you actually invest your pension money and how you are going to use your pension, but if appropriate you should also review other forms of retirement savings. Reviewing your retirement planning is critical and probably the single most important decision you can make to help you realise your long-term goals.
Different investment choices produce different results. It’s essential that you contact us to review all your retirement investments to make sure they are heading in the right direction. If your circumstances change, some investments may no longer be appropriate. It’s important to get these things right, as you will be relying on the provisions you make now to generate income after you retire.
Factors that will determine your strategy
When building or reviewing your pension portfolio, there are a number of factors that will determine your strategy, including the level of risk you are willing to take. This is likely to change throughout your life, which means your investment strategy will also need to change. Receiving professional financial advice plays a vital role in helping to make sure that your pension holdings match your risk profile and your investment goals.
Typically, people in the early years of the term of their pension may feel they have time to take more risks with their investments, to increase the potential for higher returns. As they approach retirement and the duration of the investment is shorter, they may prefer, more predictably, to start to plan for their future after work. Alternatively, if they have reached their pension age and are still investing part of their fund while drawing benefits, they may prefer to keep an element of greater risk in return for higher potential growth.
When it comes to retirement planning
Your 40s is ‘the golden decade’ when it comes to retirement planning. This is when you should be putting as much as possible into your pension to give your contributions time to grow.
In your 50s, you may want to start making decisions about your retirement. If you are going to convert all of your retirement funds into income the moment you retire, you may wish to start reducing risk now. If you expect to keep it mainly invested, you may wish to keep a good weighting in investments based on shares. After all, with the growing trend towards taking work in retirement, many people may feel they can afford to keep their pension invested for longer while drawing an income.
Delaying the start of your retirement provision will have an obvious impact on the potential growth of your pension. Not only will the time period for growth potential be reduced, but you could also be passing up the opportunity for valuable tax relief.
Streamlined pension regime
Pensions have always provided a highly tax-efficient environment for long-term retirement investments. However, in April 2006, a streamlined pension regime introduced a number of extra benefits, including the potential to contribute larger sums into your pension fund when the timing is right for you.
Lifetime Allowance
Since the rules were simplified, pensions have become easier to navigate. Whether you have occupational pensions, personal pensions or both, you now have one overall annual and one Lifetime Allowance for pension savings. You can save as much as you like towards your pension, but there is a limit on the amount of tax relief you can get. The Lifetime Allowance is the maximum amount of pension saving you can build up over your life that will benefit from tax relief. If you build up pension savings worth more than the Lifetime Allowance, you’ll pay a tax charge on the excess.
If you’re in a defined benefit scheme and you take your pension after 6 April 2014, your pension benefits will be tested against the Lifetime Allowance of £1.25 million. This level of pension saving is broadly equivalent to an annual pension of £62,500 if you don’t take a lump sum, or £46,875 if you take the 25% maximum tax free lump sum (Source: HM Revenue & Customs).
For a money purchase scheme, it‘s the value of your pension pot that is used to pay your pension benefits (such as an annuity and a tax-free lump sum) that is tested against the Lifetime Allowance at the time you take your benefits. The charge is paid on any excess over the Lifetime Allowance limit. The rate depends on how this excess is paid to you. If the amount over the Lifetime Allowance is paid as a lump sum, the rate is 55%, and if it is paid as pension, the rate is 25%.
Consolidating funds
Another feature of pensions is that you can consolidate payments from one UK registered pension scheme to another. This could be either to access different benefit options or simply to consolidate your funds in one place. It is important to note that there are costs involved, and obtaining professional financial advice is essential to ensure that you take the appropriate course of action for your specific situation.
If you have more than one pension plan in your name, there could be a number of advantages to consolidating all your plans into one. Having one pension can make it much easier for you to keep track of funds, monitor performance and change strategy if necessary. Consolidation may also cut down on paperwork and could make estate planning simpler.
Again, it’s possible that consolidating pension funds may not be beneficial for your particular circumstances. You should always receive professional financial advice before deciding if it is the right course of action for you.
Post-retirement
The array of post-retirement options is vast and will need to be considered carefully, especially in the light of the proposed changes announced in Budget 2014 to fundamentally redesign the UK private pensions system. The best option for you will depend on factors such as the size of your fund, your ongoing involvement, the risk you are willing to take and the level of benefit flexibility you want.
Annuities have long been the mainstay of turning your retirement pot into income. When it comes to buying a pension annuity, you can choose from any provider in the market, with the option of inflation-proofing it or buying a guarantee so that it continues to pay out for a set period of time. You might also want an income to continue for your spouse after your death. All these options will reduce the amount you initially receive.
Currently you have other options besides buying an annuity, such as using a drawdown facility and leaving your pension invested but receiving an income from the fund. If you do this, you can still take your 25% tax-free lump sum out of your pension.
There are many choices to make during the pre and post-retirement years. However, these choices are some of the most important you will ever make, so careful consideration is essential in order to safeguard your financial future and give you the retirement you are dreaming of.
Professional financial advice you can trust
When it comes to planning for your retirement, time is your friend. The earlier you start, the longer your money has the potential to grow. But retirement planning isn’t just paying money into your pension each month and forgetting about it – you need to be proactive. To review your current situation or requirements, please contact us for more information.
Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of and reliefs from taxation are subject to change. Tax treatment is based on individual circumstances and may be subject to change in the future. This information does not constitute advice and should not be used as the basis of any financial decision, nor should it be treated as a recommendation for any product. Although endeavours have been made to provide accurate and timely information, Professional Practice Services cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions.
Call our friendly, knowledgeable team for a confidential, no obligation discussion:
01527 880345
Retirement planning involves thinking about your plans for the future now – that means investing your money with the aim of maximising its value ready for when you retire. Careful retirement planning, the right mix of assets and starting sooner rather than later will help lead to the retirement you are looking for.
Historically, for many people, the traditional view of saving for retirement was to simply put your money into a pension, with few decisions to make in the run-up to your retirement date and no choice over how the pension was taken.
Reviewing your retirement planning
Having a pension today is recognised as just one important step along the path to achieving your dreams once you have stopped working. Now, not only must you carefully consider where you actually invest your pension money and how you are going to use your pension, but if appropriate you should also review other forms of retirement savings. Reviewing your retirement planning is critical and probably the single most important decision you can make to help you realise your long-term goals.
Different investment choices produce different results. It’s essential that you contact us to review all your retirement investments to make sure they are heading in the right direction. If your circumstances change, some investments may no longer be appropriate. It’s important to get these things right, as you will be relying on the provisions you make now to generate income after you retire.
Factors that will determine your strategy
When building or reviewing your pension portfolio, there are a number of factors that will determine your strategy, including the level of risk you are willing to take. This is likely to change throughout your life, which means your investment strategy will also need to change. Receiving professional financial advice plays a vital role in helping to make sure that your pension holdings match your risk profile and your investment goals.
Typically, people in the early years of the term of their pension may feel they have time to take more risks with their investments, to increase the potential for higher returns. As they approach retirement and the duration of the investment is shorter, they may prefer, more predictably, to start to plan for their future after work. Alternatively, if they have reached their pension age and are still investing part of their fund while drawing benefits, they may prefer to keep an element of greater risk in return for higher potential growth.
When it comes to retirement planning
Your 40s is ‘the golden decade’ when it comes to retirement planning. This is when you should be putting as much as possible into your pension to give your contributions time to grow.
In your 50s, you may want to start making decisions about your retirement. If you are going to convert all of your retirement funds into income the moment you retire, you may wish to start reducing risk now. If you expect to keep it mainly invested, you may wish to keep a good weighting in investments based on shares. After all, with the growing trend towards taking work in retirement, many people may feel they can afford to keep their pension invested for longer while drawing an income.
Delaying the start of your retirement provision will have an obvious impact on the potential growth of your pension. Not only will the time period for growth potential be reduced, but you could also be passing up the opportunity for valuable tax relief.
Streamlined pension regime
Pensions have always provided a highly tax-efficient environment for long-term retirement investments. However, in April 2006, a streamlined pension regime introduced a number of extra benefits, including the potential to contribute larger sums into your pension fund when the timing is right for you.
Lifetime Allowance
Since the rules were simplified, pensions have become easier to navigate. Whether you have occupational pensions, personal pensions or both, you now have one overall annual and one Lifetime Allowance for pension savings. You can save as much as you like towards your pension, but there is a limit on the amount of tax relief you can get. The Lifetime Allowance is the maximum amount of pension saving you can build up over your life that will benefit from tax relief. If you build up pension savings worth more than the Lifetime Allowance, you’ll pay a tax charge on the excess.
If you’re in a defined benefit scheme and you take your pension after 6 April 2014, your pension benefits will be tested against the Lifetime Allowance of £1.25 million. This level of pension saving is broadly equivalent to an annual pension of £62,500 if you don’t take a lump sum, or £46,875 if you take the 25% maximum tax free lump sum (Source: HM Revenue & Customs).
For a money purchase scheme, it‘s the value of your pension pot that is used to pay your pension benefits (such as an annuity and a tax-free lump sum) that is tested against the Lifetime Allowance at the time you take your benefits. The charge is paid on any excess over the Lifetime Allowance limit. The rate depends on how this excess is paid to you. If the amount over the Lifetime Allowance is paid as a lump sum, the rate is 55%, and if it is paid as pension, the rate is 25%.
Consolidating funds
Another feature of pensions is that you can consolidate payments from one UK registered pension scheme to another. This could be either to access different benefit options or simply to consolidate your funds in one place. It is important to note that there are costs involved, and obtaining professional financial advice is essential to ensure that you take the appropriate course of action for your specific situation.
If you have more than one pension plan in your name, there could be a number of advantages to consolidating all your plans into one. Having one pension can make it much easier for you to keep track of funds, monitor performance and change strategy if necessary. Consolidation may also cut down on paperwork and could make estate planning simpler.
Again, it’s possible that consolidating pension funds may not be beneficial for your particular circumstances. You should always receive professional financial advice before deciding if it is the right course of action for you.
Post-retirement
The array of post-retirement options is vast and will need to be considered carefully, especially in the light of the proposed changes announced in Budget 2014 to fundamentally redesign the UK private pensions system. The best option for you will depend on factors such as the size of your fund, your ongoing involvement, the risk you are willing to take and the level of benefit flexibility you want.
Annuities have long been the mainstay of turning your retirement pot into income. When it comes to buying a pension annuity, you can choose from any provider in the market, with the option of inflation-proofing it or buying a guarantee so that it continues to pay out for a set period of time. You might also want an income to continue for your spouse after your death. All these options will reduce the amount you initially receive.
Currently you have other options besides buying an annuity, such as using a drawdown facility and leaving your pension invested but receiving an income from the fund. If you do this, you can still take your 25% tax-free lump sum out of your pension.
There are many choices to make during the pre and post-retirement years. However, these choices are some of the most important you will ever make, so careful consideration is essential in order to safeguard your financial future and give you the retirement you are dreaming of.
Professional financial advice you can trust
When it comes to planning for your retirement, time is your friend. The earlier you start, the longer your money has the potential to grow. But retirement planning isn’t just paying money into your pension each month and forgetting about it – you need to be proactive. To review your current situation or requirements, please contact us for more information.
Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of and reliefs from taxation are subject to change. Tax treatment is based on individual circumstances and may be subject to change in the future. This information does not constitute advice and should not be used as the basis of any financial decision, nor should it be treated as a recommendation for any product. Although endeavours have been made to provide accurate and timely information, Professional Practice Services cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions.
Call our friendly, knowledgeable team for a confidential, no obligation discussion:
01527 880345
Visit our Website at:
www.pps-vet.co.uk
www.pps-vet.co.uk
Professional Practice Services is a Veterinary Business Consultancy and Independent Financial Advisory Firm. Professional Practice Services is authorised and regulated by the Financial Conduct Authority
The Financial Conduct Authority does not regulate finance, will writing, commercial lending, taxation or trust advice.
Article Reference: PPS062014.GM25
The Financial Conduct Authority does not regulate finance, will writing, commercial lending, taxation or trust advice.
Article Reference: PPS062014.GM25
Monday 9 March 2015
Workplace Pensions
You could soon have a pension without asking for one!
Millions of workers are being automatically enrolled into a workplace pension by their employer. A workplace pension is a way of saving for your retirement that’s arranged by your employer.
A percentage of your pay is put into the pension scheme automatically every payday.
In most cases, your employer and the Government also contribute money into the pension scheme for you. The money is used to pay you an income for the rest of your life when you start getting the pension.
You can opt out if you want to, but that means losing out on employer and government contributions – and if you stay in, you’ll have your own pension that you get when you retire.
‘Auto-enrolment’
New legal duties, from October 2012, now require employers to automatically enrol their eligible employees into a qualifying pension scheme. The reform will be ‘staged’ over a six-year period, depending on the size of the employer.
The new law means that every employer must automatically enrol workers into a workplace pension scheme who:
• Are not already in one
• Are aged between 22 and State Pension age
• Earn more than £9,440 a year
• Work in the UK
This is called ‘automatic enrolment’. You may not see any changes if you’re already in a workplace pension scheme. Your workplace pension scheme will usually carry on as normal.
But if your employer doesn’t make a contribution to your pension now, they will have to by law when they ‘automatically enrol’ every worker.
If you are an employer, you need to make sure that your business is prepared as workplace pension reform becomes applicable to you.
When it comes to making contributions, there are two main things to consider, namely:
• The level of contributions you wish to make
• The definition of pay you wish to use
Both you and your employees will be required to pay money into the pension, subject to certain minimums, as shown in the information below.
Oct 2012 to Sept 2017 – EMPLOYER: 1% EMPLOYEE 1 %
Oct 2017 to Sept 2018 – EMPLOYER: 2% EMPLOYEE 3%
Oct 2018 onwards – EMPLOYER: 3% EMPLOYEE 5%
These are only minimum amounts and you can choose to pay more than this.
You can even pay some or all of your employee’s contribution, if you wish to do so.
Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of and reliefs from taxation are subject to change. Tax treatment is based on individual circumstances and may be subject to change in the future. Although endeavours have been made to provide accurate and timely information, Professional Practice Services cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions.
Professional financial advice you can trust
Auto-enrolment affects all employers in the UK. With auto-enrolment underway, employers must now automatically enrol eligible employees into a qualifying pension scheme. Whether you are an employee or employer, we can help guide you through your pension options. To find out more, please contact us.
Call our friendly, knowledgeable team for a confidential, no obligation discussion:
01527 880345
Visit our Website at:
www.pps-vet.co.uk
Professional Practice Services is a Veterinary Business Consultancy and Independent Financial Advisory Firm. Professional Practice Services is authorised and regulated by the Financial Conduct Authority
The Financial Conduct Authority does not regulate finance, will writing, commercial lending, taxation or trust advice.
Article Reference: PPS062014.GM24
Millions of workers are being automatically enrolled into a workplace pension by their employer. A workplace pension is a way of saving for your retirement that’s arranged by your employer.
A percentage of your pay is put into the pension scheme automatically every payday.
In most cases, your employer and the Government also contribute money into the pension scheme for you. The money is used to pay you an income for the rest of your life when you start getting the pension.
You can opt out if you want to, but that means losing out on employer and government contributions – and if you stay in, you’ll have your own pension that you get when you retire.
‘Auto-enrolment’
New legal duties, from October 2012, now require employers to automatically enrol their eligible employees into a qualifying pension scheme. The reform will be ‘staged’ over a six-year period, depending on the size of the employer.
The new law means that every employer must automatically enrol workers into a workplace pension scheme who:
• Are not already in one
• Are aged between 22 and State Pension age
• Earn more than £9,440 a year
• Work in the UK
This is called ‘automatic enrolment’. You may not see any changes if you’re already in a workplace pension scheme. Your workplace pension scheme will usually carry on as normal.
But if your employer doesn’t make a contribution to your pension now, they will have to by law when they ‘automatically enrol’ every worker.
If you are an employer, you need to make sure that your business is prepared as workplace pension reform becomes applicable to you.
When it comes to making contributions, there are two main things to consider, namely:
• The level of contributions you wish to make
• The definition of pay you wish to use
Both you and your employees will be required to pay money into the pension, subject to certain minimums, as shown in the information below.
Oct 2012 to Sept 2017 – EMPLOYER: 1% EMPLOYEE 1 %
Oct 2017 to Sept 2018 – EMPLOYER: 2% EMPLOYEE 3%
Oct 2018 onwards – EMPLOYER: 3% EMPLOYEE 5%
These are only minimum amounts and you can choose to pay more than this.
You can even pay some or all of your employee’s contribution, if you wish to do so.
Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of and reliefs from taxation are subject to change. Tax treatment is based on individual circumstances and may be subject to change in the future. Although endeavours have been made to provide accurate and timely information, Professional Practice Services cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions.
Professional financial advice you can trust
Auto-enrolment affects all employers in the UK. With auto-enrolment underway, employers must now automatically enrol eligible employees into a qualifying pension scheme. Whether you are an employee or employer, we can help guide you through your pension options. To find out more, please contact us.
Call our friendly, knowledgeable team for a confidential, no obligation discussion:
01527 880345
Visit our Website at:
www.pps-vet.co.uk
Professional Practice Services is a Veterinary Business Consultancy and Independent Financial Advisory Firm. Professional Practice Services is authorised and regulated by the Financial Conduct Authority
The Financial Conduct Authority does not regulate finance, will writing, commercial lending, taxation or trust advice.
Article Reference: PPS062014.GM24
Monday 23 February 2015
Trusts
Choosing the right structures to protect assets and give your family lasting benefits
One of the most effective ways you can manage your estate planning is through setting up a trust. The structures into which you can transfer your assets can have lasting consequences for you and your family, so it is important that you obtain professional financial advice as the right structures can protect assets and give your family lasting benefits.
A trust is a legal arrangement where one or more trustees are made legally responsible for assets. The assets – such as land, money, buildings, shares or even antiques – are placed in trust for the benefit of one or more beneficiaries. They are not the sole domain of the super-rich. Trusts are incredibly useful and flexible devices that people employ for all sorts of different purposes, including Inheritance Tax planning.
Simplest form
In its simplest form, a trust is just a legal mechanism for separating the ownership of an asset into two parts: the ‘legal’ ownership (or title to the asset) on the one hand, and the ‘beneficial’ ownership on the other hand.
It is in the course of Inheritance Tax planning, though, that people are most likely to come face to face with trusts and seek to get an understanding of what they are and how they work. Their use is widespread and, despite some recent adverse changes in tax law, they remain an important tool in estate planning.
More flexibility
The trust is created when the settlor transfers assets to the trustees, who hold the assets in trust for the beneficiaries. The main reason a person would put assets into a trust rather than make an outright gift is that trusts offer far more flexibility than outright gifts.
The trustees are responsible for managing the trust and carrying out the wishes of the person who has put the assets into trust (the settlor). The settlor’s wishes for the trust are usually written in their Will or given in a legal document called the trust deed.
The purpose of a trust
Trusts may be set up for a number of reasons, for example:
• To control and protect family assets
• When someone is too young to handle their affairs
• When someone can’t handle their affairs because they are incapacitated
• To pass on money or property while you are still alive
• To pass on money or assets when you die under the terms of your Will – known as a ‘Will trust’
• Under the rules of inheritance that apply when someone dies without leaving a valid Will (England and Wales only)
There are several types of UK family trusts, and each type of trust may be taxed differently. There are other types of non-family trusts. These are set up for many reasons, for example, to operate as a charity or to provide a means for employers to create a pension scheme for their staff.
When you might have to pay Inheritance Tax on your trust
There are four main situations when Inheritance Tax may be due on trusts:
• When assets are transferred – or settled – into a trust
• When a trust reaches a ten-year anniversary of when it was set up
• When assets are transferred out of a trust or the trust comes to an end
• When someone dies and a trust is involved when sorting out their estate
Trust solutions for managing wealth
We can advise you on a range of different trust solutions, each designed with a particular purpose in mind.
Some types of trust are treated differently for Inheritance Tax purposes.
Bare trusts
These are where the assets in a trust are held in the name of a trustee but go directly to the beneficiary, who has a right to both the assets and income of the trust.
Transfers into a bare trust may also be exempt from Inheritance Tax, as long as the person making the transfer survives for seven years after making the transfer.
Interest in possession trusts
These are trusts where the beneficiary is entitled to trust income as it’s produced – this is called their ‘interest in possession’.
On assets transferred into this type of trust before 22 March 2006, there’s no Inheritance Tax to pay.
On assets transferred on or after 22 March 2006, the 10-yearly Inheritance Tax charge may be due.
During the life of the trust, there’s no Inheritance Tax to pay as long as the asset stays in the trust and remains the ‘interest’ of the beneficiary.
Between 22 March 2006 and 5 October 2008:
• Beneficiaries of an interest in possession trust could pass on their interest in possession to other beneficiaries, like their children
• This was called making a ‘transitional serial interest’
• There’s no Inheritance Tax to pay in this situation
From 5 October 2008:
• Beneficiaries of an interest in possession trust can’t pass their interest on as a transitional serial interest
• If an interest is transferred after this date, there may be a charge of 20% and a 10-yearly Inheritance Tax charge will be payable unless it’s a disabled trust
If you inherit an interest in possession trust from someone who has died, there’s no Inheritance Tax at the 10 year anniversary. Instead, 40% tax will be due when you die.
Information is based on our current understanding of taxation legislation and regulations. Tax assumptions are subject to statutory change and the value of tax relief (if any) will depend upon your individual circumstances. The Financial Conduct Authority does not regulate Taxation and Trust Advice or Will Writing. The value of your investment can go down as well as up and you may not get back the full amount invested. Levels and bases of and reliefs from taxation are subject to change and their value depends on the individual circumstances of the investor. The treatment of Trusts for tax purposes is the same throughout the United Kingdom. However, Scottish law on Trusts and the terms used in relation to Trusts in Scotland are different from the laws of England and Wales and Northern Ireland. This information does not constitute advice and should not be used as the basis of any financial decision, nor should it be treated as a recommendation for any product. Although endeavours have been made to provide accurate and timely information, Professional Practice Services cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions.
Professional financial advice you can trust
Do you need someone to manage money for you – for example, to use it to help someone after your death, or to pay for your care later on? One way to do this is to put the money into a trust. To discuss your requirements, please contact us for more information – we look forward to hearing from you.
Call our friendly, knowledgeable team for a confidential, no obligation discussion:
01527 880345
One of the most effective ways you can manage your estate planning is through setting up a trust. The structures into which you can transfer your assets can have lasting consequences for you and your family, so it is important that you obtain professional financial advice as the right structures can protect assets and give your family lasting benefits.
A trust is a legal arrangement where one or more trustees are made legally responsible for assets. The assets – such as land, money, buildings, shares or even antiques – are placed in trust for the benefit of one or more beneficiaries. They are not the sole domain of the super-rich. Trusts are incredibly useful and flexible devices that people employ for all sorts of different purposes, including Inheritance Tax planning.
Simplest form
In its simplest form, a trust is just a legal mechanism for separating the ownership of an asset into two parts: the ‘legal’ ownership (or title to the asset) on the one hand, and the ‘beneficial’ ownership on the other hand.
It is in the course of Inheritance Tax planning, though, that people are most likely to come face to face with trusts and seek to get an understanding of what they are and how they work. Their use is widespread and, despite some recent adverse changes in tax law, they remain an important tool in estate planning.
More flexibility
The trust is created when the settlor transfers assets to the trustees, who hold the assets in trust for the beneficiaries. The main reason a person would put assets into a trust rather than make an outright gift is that trusts offer far more flexibility than outright gifts.
The trustees are responsible for managing the trust and carrying out the wishes of the person who has put the assets into trust (the settlor). The settlor’s wishes for the trust are usually written in their Will or given in a legal document called the trust deed.
The purpose of a trust
Trusts may be set up for a number of reasons, for example:
• To control and protect family assets
• When someone is too young to handle their affairs
• When someone can’t handle their affairs because they are incapacitated
• To pass on money or property while you are still alive
• To pass on money or assets when you die under the terms of your Will – known as a ‘Will trust’
• Under the rules of inheritance that apply when someone dies without leaving a valid Will (England and Wales only)
There are several types of UK family trusts, and each type of trust may be taxed differently. There are other types of non-family trusts. These are set up for many reasons, for example, to operate as a charity or to provide a means for employers to create a pension scheme for their staff.
When you might have to pay Inheritance Tax on your trust
There are four main situations when Inheritance Tax may be due on trusts:
• When assets are transferred – or settled – into a trust
• When a trust reaches a ten-year anniversary of when it was set up
• When assets are transferred out of a trust or the trust comes to an end
• When someone dies and a trust is involved when sorting out their estate
Trust solutions for managing wealth
We can advise you on a range of different trust solutions, each designed with a particular purpose in mind.
Some types of trust are treated differently for Inheritance Tax purposes.
Bare trusts
These are where the assets in a trust are held in the name of a trustee but go directly to the beneficiary, who has a right to both the assets and income of the trust.
Transfers into a bare trust may also be exempt from Inheritance Tax, as long as the person making the transfer survives for seven years after making the transfer.
Interest in possession trusts
These are trusts where the beneficiary is entitled to trust income as it’s produced – this is called their ‘interest in possession’.
On assets transferred into this type of trust before 22 March 2006, there’s no Inheritance Tax to pay.
On assets transferred on or after 22 March 2006, the 10-yearly Inheritance Tax charge may be due.
During the life of the trust, there’s no Inheritance Tax to pay as long as the asset stays in the trust and remains the ‘interest’ of the beneficiary.
Between 22 March 2006 and 5 October 2008:
• Beneficiaries of an interest in possession trust could pass on their interest in possession to other beneficiaries, like their children
• This was called making a ‘transitional serial interest’
• There’s no Inheritance Tax to pay in this situation
From 5 October 2008:
• Beneficiaries of an interest in possession trust can’t pass their interest on as a transitional serial interest
• If an interest is transferred after this date, there may be a charge of 20% and a 10-yearly Inheritance Tax charge will be payable unless it’s a disabled trust
If you inherit an interest in possession trust from someone who has died, there’s no Inheritance Tax at the 10 year anniversary. Instead, 40% tax will be due when you die.
Information is based on our current understanding of taxation legislation and regulations. Tax assumptions are subject to statutory change and the value of tax relief (if any) will depend upon your individual circumstances. The Financial Conduct Authority does not regulate Taxation and Trust Advice or Will Writing. The value of your investment can go down as well as up and you may not get back the full amount invested. Levels and bases of and reliefs from taxation are subject to change and their value depends on the individual circumstances of the investor. The treatment of Trusts for tax purposes is the same throughout the United Kingdom. However, Scottish law on Trusts and the terms used in relation to Trusts in Scotland are different from the laws of England and Wales and Northern Ireland. This information does not constitute advice and should not be used as the basis of any financial decision, nor should it be treated as a recommendation for any product. Although endeavours have been made to provide accurate and timely information, Professional Practice Services cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions.
Professional financial advice you can trust
Do you need someone to manage money for you – for example, to use it to help someone after your death, or to pay for your care later on? One way to do this is to put the money into a trust. To discuss your requirements, please contact us for more information – we look forward to hearing from you.
Call our friendly, knowledgeable team for a confidential, no obligation discussion:
01527 880345
Visit our Website at:
www.pps-vet.co.uk
www.pps-vet.co.uk
Professional Practice Services is a Veterinary Business Consultancy and Independent Financial Advisory Firm. Professional Practice Services is authorised and regulated by the Financial Conduct Authority
The Financial Conduct Authority does not regulate finance, will writing, commercial lending, taxation or trust advice.
Article Reference: PPS062014.GM23
The Financial Conduct Authority does not regulate finance, will writing, commercial lending, taxation or trust advice.
Article Reference: PPS062014.GM23
Monday 9 February 2015
Inheritance Tax Matters
Not quite the ‘voluntary’ tax it was once considered
Effective estate planning is about getting the right balance between maintaining access to your money when you need it and saving tax. This is because, in general, the more tax efficient a solution is, the less access you have to your assets. Safeguarding your own financial future is very important, and giving too much away could put this at risk.
Inheritance Tax is the tax that is paid on your estate, chargeable at a current rate of 40%, and is now perhaps not quite the ‘voluntary’ tax it was once considered. However, careful planning to ensure you take advantage of all the allowances and reliefs available could save you a lot of money relatively easily. It’s never too early to start.
Broadly speaking, this is a tax on everything you own at the time of your death, less what you owe. It’s also sometimes payable on assets you may have given away during your lifetime. Assets include property, possessions, money and investments, and life insurance policies not written in an appropriate trust. One thing is certain: careful planning is required to protect your wealth from a potential Inheritance Tax liability.
Not everyone pays Inheritance Tax on their death. It only applies if the taxable value of your estate when you die (including your share of any jointly owned assets and assets held in some types of trusts) is above the current £325,000 threshold (frozen until 6 April 2017 to 5 April 2018) or ‘Nil Rate Band’. It is only payable on the excess above this amount.
Inheritance Tax exemptions and reliefs
Sometimes, even if your estate is over the threshold, you can pass on assets without having to pay Inheritance Tax. Examples include:
• Spouse or registered civil partner exemption: Your estate usually doesn’t owe Inheritance Tax on anything you leave to a spouse or registered civil partner who has their permanent home in the UK – nor on gifts you make to them in your lifetime – even if the amount is over the threshold
• Charity exemption: Any gifts you make to a qualifying charity – during your lifetime or in your Will – will be exempt from Inheritance Tax
• Potentially exempt transfers: If you survive for seven years after making a gift to someone, the gift is generally exempt from Inheritance Tax, no matter what the value
• Annual exemption: You can give up to £3,000 away each year, either as a single gift or as several gifts adding up to that amount – you can also use your unused allowance from the previous year, but you use the current year’s allowance first
• Small gift exemption: You can make small gifts of up to £250 to as many individuals as you like tax-free
• Wedding and registered civil partnership gifts: Gifts to someone getting married or registering a civil partnership are exempt up to a certain amount
• Business, Woodland, Heritage and Farm Relief: If the deceased owned a business, farm, woodland or National Heritage property, some relief from Inheritance Tax may be available
Transfers of assets into most trusts and companies will become subject to an immediate Inheritance Tax charge if they exceed the Inheritance Tax threshold (taking into account the previous seven years’ chargeable gifts and transfers).
In addition, transfers of money or property into most trusts are also subject to an immediate Inheritance Tax charge on values that exceed the Inheritance Tax threshold. Tax is also payable ten-yearly on the value of trust assets above the threshold; however, certain trusts are exempt from these rules.
Gifts and transfers made in the previous seven years
In order to work out whether the current Inheritance Tax threshold of £325,000 has been exceeded on a transfer, you need to take into account all chargeable (non-exempt, including potentially exempt) gifts and transfers made in the previous seven years. If a transfer takes you over the nil rate band, Inheritance Tax is payable at 20% on the excess.
Information is based on our current understanding of taxation legislation and regulations. Tax assumptions are subject to statutory change and the value of tax relief (if any) will depend upon your individual circumstances. The Financial Conduct Authority does not regulate Taxation and Trust Advice or Will Writing. The value of your investment can go down as well as up and you may not get back the full amount invested. Levels and bases of and reliefs from taxation are subject to change and their value depends on the individual circumstances of the investor. This information does not constitute advice and should not be used as the basis of any financial decision, nor should it be treated as a recommendation for any product. Although endeavours have been made to provide accurate and timely information, Professional Practice Services cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions.
Professional financial advice you can trust
We will assess your situation and provide advice on a number of tax migration solutions bespoke estate protection planning strategies that are tailored to suit you and your circumstances. To review your particular situation, please contact us for further information. Don’t leave it to chance.
Call our friendly, knowledgeable team for a confidential, no obligation discussion:
01527 880345
Effective estate planning is about getting the right balance between maintaining access to your money when you need it and saving tax. This is because, in general, the more tax efficient a solution is, the less access you have to your assets. Safeguarding your own financial future is very important, and giving too much away could put this at risk.
Inheritance Tax is the tax that is paid on your estate, chargeable at a current rate of 40%, and is now perhaps not quite the ‘voluntary’ tax it was once considered. However, careful planning to ensure you take advantage of all the allowances and reliefs available could save you a lot of money relatively easily. It’s never too early to start.
Broadly speaking, this is a tax on everything you own at the time of your death, less what you owe. It’s also sometimes payable on assets you may have given away during your lifetime. Assets include property, possessions, money and investments, and life insurance policies not written in an appropriate trust. One thing is certain: careful planning is required to protect your wealth from a potential Inheritance Tax liability.
Not everyone pays Inheritance Tax on their death. It only applies if the taxable value of your estate when you die (including your share of any jointly owned assets and assets held in some types of trusts) is above the current £325,000 threshold (frozen until 6 April 2017 to 5 April 2018) or ‘Nil Rate Band’. It is only payable on the excess above this amount.
Inheritance Tax exemptions and reliefs
Sometimes, even if your estate is over the threshold, you can pass on assets without having to pay Inheritance Tax. Examples include:
• Spouse or registered civil partner exemption: Your estate usually doesn’t owe Inheritance Tax on anything you leave to a spouse or registered civil partner who has their permanent home in the UK – nor on gifts you make to them in your lifetime – even if the amount is over the threshold
• Charity exemption: Any gifts you make to a qualifying charity – during your lifetime or in your Will – will be exempt from Inheritance Tax
• Potentially exempt transfers: If you survive for seven years after making a gift to someone, the gift is generally exempt from Inheritance Tax, no matter what the value
• Annual exemption: You can give up to £3,000 away each year, either as a single gift or as several gifts adding up to that amount – you can also use your unused allowance from the previous year, but you use the current year’s allowance first
• Small gift exemption: You can make small gifts of up to £250 to as many individuals as you like tax-free
• Wedding and registered civil partnership gifts: Gifts to someone getting married or registering a civil partnership are exempt up to a certain amount
• Business, Woodland, Heritage and Farm Relief: If the deceased owned a business, farm, woodland or National Heritage property, some relief from Inheritance Tax may be available
Transfers of assets into most trusts and companies will become subject to an immediate Inheritance Tax charge if they exceed the Inheritance Tax threshold (taking into account the previous seven years’ chargeable gifts and transfers).
In addition, transfers of money or property into most trusts are also subject to an immediate Inheritance Tax charge on values that exceed the Inheritance Tax threshold. Tax is also payable ten-yearly on the value of trust assets above the threshold; however, certain trusts are exempt from these rules.
Gifts and transfers made in the previous seven years
In order to work out whether the current Inheritance Tax threshold of £325,000 has been exceeded on a transfer, you need to take into account all chargeable (non-exempt, including potentially exempt) gifts and transfers made in the previous seven years. If a transfer takes you over the nil rate band, Inheritance Tax is payable at 20% on the excess.
Information is based on our current understanding of taxation legislation and regulations. Tax assumptions are subject to statutory change and the value of tax relief (if any) will depend upon your individual circumstances. The Financial Conduct Authority does not regulate Taxation and Trust Advice or Will Writing. The value of your investment can go down as well as up and you may not get back the full amount invested. Levels and bases of and reliefs from taxation are subject to change and their value depends on the individual circumstances of the investor. This information does not constitute advice and should not be used as the basis of any financial decision, nor should it be treated as a recommendation for any product. Although endeavours have been made to provide accurate and timely information, Professional Practice Services cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions.
Professional financial advice you can trust
We will assess your situation and provide advice on a number of tax migration solutions bespoke estate protection planning strategies that are tailored to suit you and your circumstances. To review your particular situation, please contact us for further information. Don’t leave it to chance.
Call our friendly, knowledgeable team for a confidential, no obligation discussion:
01527 880345
Visit our Website at:
www.pps-vet.co.uk
www.pps-vet.co.uk
Professional Practice Services is a Veterinary Business Consultancy and Independent Financial Advisory Firm. Professional Practice Services is authorised and regulated by the Financial Conduct Authority
The Financial Conduct Authority does not regulate finance, will writing, commercial lending, taxation or trust advice.
Article Reference: PPS062014.GM21
The Financial Conduct Authority does not regulate finance, will writing, commercial lending, taxation or trust advice.
Article Reference: PPS062014.GM21
Monday 26 January 2015
Making a Will
Sharing out your estate
Planning your finances in advance should help you ensure that when you die, everything you own goes where you want it to. Making a Will is the first step in ensuring that your estate is shared out exactly as you want it to be.
If you don’t make a Will, there are rules for sharing out your estate called the ‘Law of Intestacy’, which could mean your money going to family members who may not need it, with your unmarried partner or a partner with whom you are not in a registered civil partnership receiving nothing at all.
If you leave everything to your spouse or registered civil partner, there’ll be no Inheritance Tax to pay because they are classed as an exempt beneficiary. Or you may decide to use your tax-free allowance to give some of your estate to someone else, or to a family trust.
Good reasons to make a Will
A Will sets out who is to benefit from your property and possessions (your estate) after your death.
There are many good reasons to make a Will:
• You can decide how your assets are shared – if you don’t have a Will, the law says who gets what
• If you’re an unmarried couple (whether or not it’s a same-sex relationship), you can make sure your partner is provided for
• If you’re divorced, you can decide whether to leave anything to your former partner
• You can make sure you don’t pay more Inheritance Tax than necessary
Before you write a Will, it’s a good idea to think about what you want included in it.
You should consider:
• How much money and what property and possessions you have
• Who you want to benefit from your Will
• Who should look after any children under 18 years of age
• Who is going to sort out your estate and carry out your wishes after your death (your executor?)
Passing on your estate
An executor is the person responsible for passing on your estate. You can appoint an executor by naming them in your Will. The courts can also appoint other people to be responsible for doing this job.
Once you’ve made your Will, it is important to keep it in a safe place and tell your executor, close friend or relative where it is.
It is advisable to review your Will every five years and after any major change in your life, such as getting separated, married or divorced, having a child, or moving house. Any change must be by codicil (an addition, amendment or supplement to a Will) or by making a new Will.
Scottish law on inheritance differs from English law.
Information is based on our current understanding of taxation legislation and regulations. Tax assumptions are subject to statutory change and the value of tax relief (if any) will depend upon your individual circumstances. The Financial Conduct Authority does not regulate Taxation and Trust Advice or Will Writing. The value of your investment can go down as well as up and you may not get back the full amount invested. Levels and bases of and reliefs from taxation are subject to change and their value depends on the individual circumstances of the investor. This information does not constitute advice and should not be used as the basis of any financial decision, nor should it be treated as a recommendation for any product. Although endeavours have been made to provide accurate and timely information, Professional Practice Services cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions.
Professional financial advice you can trust
We will help you make your wishes known to ensure your property and possessions go to the ones you love, so you can have complete peace of mind and reduce the worry, stress and likelihood of disagreements for those you leave behind. To discuss your requirements, please contact us.
Call our friendly, knowledgeable team for a confidential, no obligation discussion:
01527 880345
Planning your finances in advance should help you ensure that when you die, everything you own goes where you want it to. Making a Will is the first step in ensuring that your estate is shared out exactly as you want it to be.
If you don’t make a Will, there are rules for sharing out your estate called the ‘Law of Intestacy’, which could mean your money going to family members who may not need it, with your unmarried partner or a partner with whom you are not in a registered civil partnership receiving nothing at all.
If you leave everything to your spouse or registered civil partner, there’ll be no Inheritance Tax to pay because they are classed as an exempt beneficiary. Or you may decide to use your tax-free allowance to give some of your estate to someone else, or to a family trust.
Good reasons to make a Will
A Will sets out who is to benefit from your property and possessions (your estate) after your death.
There are many good reasons to make a Will:
• You can decide how your assets are shared – if you don’t have a Will, the law says who gets what
• If you’re an unmarried couple (whether or not it’s a same-sex relationship), you can make sure your partner is provided for
• If you’re divorced, you can decide whether to leave anything to your former partner
• You can make sure you don’t pay more Inheritance Tax than necessary
Before you write a Will, it’s a good idea to think about what you want included in it.
You should consider:
• How much money and what property and possessions you have
• Who you want to benefit from your Will
• Who should look after any children under 18 years of age
• Who is going to sort out your estate and carry out your wishes after your death (your executor?)
Passing on your estate
An executor is the person responsible for passing on your estate. You can appoint an executor by naming them in your Will. The courts can also appoint other people to be responsible for doing this job.
Once you’ve made your Will, it is important to keep it in a safe place and tell your executor, close friend or relative where it is.
It is advisable to review your Will every five years and after any major change in your life, such as getting separated, married or divorced, having a child, or moving house. Any change must be by codicil (an addition, amendment or supplement to a Will) or by making a new Will.
Scottish law on inheritance differs from English law.
Information is based on our current understanding of taxation legislation and regulations. Tax assumptions are subject to statutory change and the value of tax relief (if any) will depend upon your individual circumstances. The Financial Conduct Authority does not regulate Taxation and Trust Advice or Will Writing. The value of your investment can go down as well as up and you may not get back the full amount invested. Levels and bases of and reliefs from taxation are subject to change and their value depends on the individual circumstances of the investor. This information does not constitute advice and should not be used as the basis of any financial decision, nor should it be treated as a recommendation for any product. Although endeavours have been made to provide accurate and timely information, Professional Practice Services cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions.
Professional financial advice you can trust
We will help you make your wishes known to ensure your property and possessions go to the ones you love, so you can have complete peace of mind and reduce the worry, stress and likelihood of disagreements for those you leave behind. To discuss your requirements, please contact us.
Call our friendly, knowledgeable team for a confidential, no obligation discussion:
01527 880345
Visit our Website at:
www.pps-vet.co.uk
www.pps-vet.co.uk
Professional Practice Services is a Veterinary Business Consultancy and Independent Financial Advisory Firm. Professional Practice Services is authorised and regulated by the Financial Conduct Authority
The Financial Conduct Authority does not regulate finance, will writing, commercial lending, taxation or trust advice.
Article Reference: PPS062014.GM20
The Financial Conduct Authority does not regulate finance, will writing, commercial lending, taxation or trust advice.
Article Reference: PPS062014.GM20
Monday 12 January 2015
State Pension
A regular income once you reach State Pension age
The State Pension gives you a regular income once you reach State Pension age. It is based on National Insurance contributions and the amount you get depends on how much you paid in. To receive it you must have paid or been credited with National Insurance contributions.
There are different rates of State Pension. The rate you receive depends on your circumstances. The full Basic State Pension is currently £113.10 per week – under existing rules, the amount of State Pension you get depends on your National Insurance contributions, and sometimes those of your current or former spouse or registered civil partner.
Basic State Pension – what is the rate?
The following list is an overview of the maximum basic State Pension you can get.
Circumstances and Basic State Pension weekly rate for 2014/2015
Single man or woman:
£113.10
Married man, woman or registered civil partner (who qualifies with their own National Insurance Contributions):
£113.10
Married man, woman or registered civil partner (using his wife’s, her husband’s or registered civil partner’s National Insurance record):
£67.80
You may have made contributions from your earnings or have been credited with them by the Government, if you were caring for a child or disabled person.
The basic State Pension increases every year by whichever is the highest:
• Earnings – the average percentage growth in wages (in Great Britain)
• Prices – the percentage growth in prices in the UK as measured by the Consumer Prices Index (CPI)
• 2.5%
You may have to pay tax on your basic State Pension.
You can top up your State Pension to £67.80 per week if:
• You expect your basic State Pension will be less than that
• You’re married or in a registered civil partnership
• You meet the qualifying rules
Additional State Pension
You might also qualify for the Additional State Pension. The Additional State Pension is sometimes also known as ‘SERPS’ or the ‘State Second Pension’ (S2P). Not everyone receives an additional State Pension. The amount you get depends on your earnings.
Additional parts of the State Pension rise in line with the increase in prices. These include:
• The State Second Pension (S2P)
• The State Earnings-Related Pension Scheme (SERPS)
• Graduated Retirement Benefit
• Extra State Pension received for putting off (deferring) your State Pension claim (also called ‘increments’)
Until you reach State Pension age, the amount of State Second Pension or SERPS you have built up will usually be increased in line with the growth in average earnings. This is also known as ‘revaluation’.
Receiving the basic State Pension
The earliest you can receive the basic State Pension is when you reach State Pension age. Your basic State Pension depends on the number of years you’ve paid National Insurance or got National Insurance credits, for example, while unemployed or claiming certain benefits.
To qualify for a basic State Pension, at least one of the following must apply:
• You were working and paying National Insurance
• You were getting certain benefits, for example, unemployment or sickness
• You were a parent or carer and claiming certain benefits or credits
• You have a spouse or registered civil partner whose National Insurance contributions cover you
• You were paying voluntary National Insurance contributions
You need 30 years’ worth of contributions or credits to get the full basic State Pension. These are your ‘qualifying years’.
If you have fewer than 30 years, your State Pension will be less than £113.10 per week, but you might be able to top up by paying voluntary National Insurance contributions.
Over 80 Pensions
The Over 80 Pension is a State Pension that is available if you are aged over 80 and have little or no State Pension.
The rate is currently £67.80 weekly in the tax year 2014/2015 if you don’t get a basic State Pension. If you’re on a reduced State Pension, the Over 80 Pension will top up your State Pension to £67.80 a week.
Pension Credit
If you are a pensioner in the current tax year 2014/2015, Pension Credit could top up your weekly income to a guaranteed minimum of:
• £148.35 if you are single
• £226.50 if you have a spouse or partner
If you are aged over 65, you may also be able to get Savings Credit up to an additional:
• £16.80 weekly if you are single
• £20.70 weekly if you have a spouse or partner
The age when you can claim Pension Credit is rising in line with the increase in State Pension age for women and the further increase to 66 for men and women.
Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of and reliefs from taxation are subject to change. Tax treatment is based on individual circumstances and may be subject to change in the future. This information does not constitute investment advice and should not be used as the basis of any investment decision, nor should it be treated as a recommendation for any investment. Although endeavours have been made to provide accurate and timely information, Professional Practice Services cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions.
Professional financial advice you can trust
There are a number of rules that can influence your retirement planning. To discover how we could help you save for your retirement and achieve financial independence, please contact us for further information.
Call our friendly, knowledgeable team for a confidential, no obligation discussion:
01527 880345
Visit our Website at:
www.pps-vet.co.uk
Professional Practice Services is a Veterinary Business Consultancy and Independent Financial Advisory Firm. Professional Practice Services is authorised and regulated by the Financial Conduct Authority
The Financial Conduct Authority does not regulate finance, will writing, commercial lending, taxation or trust advice.
Article Reference: PPS062014.GM19
The State Pension gives you a regular income once you reach State Pension age. It is based on National Insurance contributions and the amount you get depends on how much you paid in. To receive it you must have paid or been credited with National Insurance contributions.
There are different rates of State Pension. The rate you receive depends on your circumstances. The full Basic State Pension is currently £113.10 per week – under existing rules, the amount of State Pension you get depends on your National Insurance contributions, and sometimes those of your current or former spouse or registered civil partner.
Basic State Pension – what is the rate?
The following list is an overview of the maximum basic State Pension you can get.
Circumstances and Basic State Pension weekly rate for 2014/2015
Single man or woman:
£113.10
Married man, woman or registered civil partner (who qualifies with their own National Insurance Contributions):
£113.10
Married man, woman or registered civil partner (using his wife’s, her husband’s or registered civil partner’s National Insurance record):
£67.80
You may have made contributions from your earnings or have been credited with them by the Government, if you were caring for a child or disabled person.
The basic State Pension increases every year by whichever is the highest:
• Earnings – the average percentage growth in wages (in Great Britain)
• Prices – the percentage growth in prices in the UK as measured by the Consumer Prices Index (CPI)
• 2.5%
You may have to pay tax on your basic State Pension.
You can top up your State Pension to £67.80 per week if:
• You expect your basic State Pension will be less than that
• You’re married or in a registered civil partnership
• You meet the qualifying rules
Additional State Pension
You might also qualify for the Additional State Pension. The Additional State Pension is sometimes also known as ‘SERPS’ or the ‘State Second Pension’ (S2P). Not everyone receives an additional State Pension. The amount you get depends on your earnings.
Additional parts of the State Pension rise in line with the increase in prices. These include:
• The State Second Pension (S2P)
• The State Earnings-Related Pension Scheme (SERPS)
• Graduated Retirement Benefit
• Extra State Pension received for putting off (deferring) your State Pension claim (also called ‘increments’)
Until you reach State Pension age, the amount of State Second Pension or SERPS you have built up will usually be increased in line with the growth in average earnings. This is also known as ‘revaluation’.
Receiving the basic State Pension
The earliest you can receive the basic State Pension is when you reach State Pension age. Your basic State Pension depends on the number of years you’ve paid National Insurance or got National Insurance credits, for example, while unemployed or claiming certain benefits.
To qualify for a basic State Pension, at least one of the following must apply:
• You were working and paying National Insurance
• You were getting certain benefits, for example, unemployment or sickness
• You were a parent or carer and claiming certain benefits or credits
• You have a spouse or registered civil partner whose National Insurance contributions cover you
• You were paying voluntary National Insurance contributions
You need 30 years’ worth of contributions or credits to get the full basic State Pension. These are your ‘qualifying years’.
If you have fewer than 30 years, your State Pension will be less than £113.10 per week, but you might be able to top up by paying voluntary National Insurance contributions.
Over 80 Pensions
The Over 80 Pension is a State Pension that is available if you are aged over 80 and have little or no State Pension.
The rate is currently £67.80 weekly in the tax year 2014/2015 if you don’t get a basic State Pension. If you’re on a reduced State Pension, the Over 80 Pension will top up your State Pension to £67.80 a week.
Pension Credit
If you are a pensioner in the current tax year 2014/2015, Pension Credit could top up your weekly income to a guaranteed minimum of:
• £148.35 if you are single
• £226.50 if you have a spouse or partner
If you are aged over 65, you may also be able to get Savings Credit up to an additional:
• £16.80 weekly if you are single
• £20.70 weekly if you have a spouse or partner
The age when you can claim Pension Credit is rising in line with the increase in State Pension age for women and the further increase to 66 for men and women.
Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of and reliefs from taxation are subject to change. Tax treatment is based on individual circumstances and may be subject to change in the future. This information does not constitute investment advice and should not be used as the basis of any investment decision, nor should it be treated as a recommendation for any investment. Although endeavours have been made to provide accurate and timely information, Professional Practice Services cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions.
Professional financial advice you can trust
There are a number of rules that can influence your retirement planning. To discover how we could help you save for your retirement and achieve financial independence, please contact us for further information.
Call our friendly, knowledgeable team for a confidential, no obligation discussion:
01527 880345
Visit our Website at:
www.pps-vet.co.uk
Professional Practice Services is a Veterinary Business Consultancy and Independent Financial Advisory Firm. Professional Practice Services is authorised and regulated by the Financial Conduct Authority
The Financial Conduct Authority does not regulate finance, will writing, commercial lending, taxation or trust advice.
Article Reference: PPS062014.GM19
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