Whilst not wanting to turn this thread into anything remotely political, for those interested in Pensions it looks as if Labour have rowed back and will no longer be putting in their manifesto the bringing back of the LTA - one piece of good news this week!
My suspicion is this is a temporary relief only and something will be brought in at some stage but perhaps in a slightly different format.
Agree, I think flat tax relief is probably the easiest and most obvious change that will happen in future.
How do the authorities know if after I died that Ive given money to someone as a gift or whether this payment was for work that’s been carried out?
The other point to note here is that if it is for work carried out, the recipient should declare it for income tax purposes. Therefore you would need to be very careful before arguing this.
Whilst not wanting to turn this thread into anything remotely political, for those interested in Pensions it looks as if Labour have rowed back and will no longer be putting in their manifesto the bringing back of the LTA - one piece of good news this week!
My suspicion is this is a temporary relief only and something will be brought in at some stage but perhaps in a slightly different format.
Agree, I think flat tax relief is probably the easiest and most obvious change that will happen in future.
And justified. In my opinion it has always been perverse and not exactly progressive that a 20% tax payer gets 20% tax relief on pension contributions and a 45% tax payer gets 45% relief.
any gifts prior to death within 7 years come first, ie they will use up the IHT allowance before anything else.
so give away less than £325k and die within 7 years they’ll be no taper relief as it simply uses up an element of the £325k.
I must admit I had totally missed this fact. Can make a difference. There is another assumption I've always made that you may be able to confirm or otherwise. First of all my estate goes solely to my wife and I know there is no IHT on that. However if I made a gift, die within 7 years of that gift, but my wife lives beyond the 7 years, then, am I right in saying, that there is no IHT on the gift made.
Whilst not wanting to turn this thread into anything remotely political, for those interested in Pensions it looks as if Labour have rowed back and will no longer be putting in their manifesto the bringing back of the LTA - one piece of good news this week!
My suspicion is this is a temporary relief only and something will be brought in at some stage but perhaps in a slightly different format.
Agree, I think flat tax relief is probably the easiest and most obvious change that will happen in future.
And justified. In my opinion it has always been perverse and not exactly progressive that a 20% tax payer gets 20% tax relief on pension contributions and a 45% tax payer gets 45% relief.
A flat rate of 25% would be sensible.
Don’t disagree, they’ll have to unravel salary sacrifice though otherwise will make zero difference so maybe not actually that easy!
Whilst not wanting to turn this thread into anything remotely political, for those interested in Pensions it looks as if Labour have rowed back and will no longer be putting in their manifesto the bringing back of the LTA - one piece of good news this week!
My suspicion is this is a temporary relief only and something will be brought in at some stage but perhaps in a slightly different format.
Agree, I think flat tax relief is probably the easiest and most obvious change that will happen in future.
And justified. In my opinion it has always been perverse and not exactly progressive that a 20% tax payer gets 20% tax relief on pension contributions and a 45% tax payer gets 45% relief.
A flat rate of 25% would be sensible.
Agree not progressive. However wouldn't it do serious damage to the pensions industry. Only 25% relief when paying in but maybe taxed at 40% when drawn down. Would need a whole new ballgame of calculations for golfie and his clan
Whilst not wanting to turn this thread into anything remotely political, for those interested in Pensions it looks as if Labour have rowed back and will no longer be putting in their manifesto the bringing back of the LTA - one piece of good news this week!
My suspicion is this is a temporary relief only and something will be brought in at some stage but perhaps in a slightly different format.
Agree, I think flat tax relief is probably the easiest and most obvious change that will happen in future.
And justified. In my opinion it has always been perverse and not exactly progressive that a 20% tax payer gets 20% tax relief on pension contributions and a 45% tax payer gets 45% relief.
A flat rate of 25% would be sensible.
Agree not progressive. However wouldn't it do serious damage to the pensions industry. Only 25% relief when paying in but maybe taxed at 40% when drawn down. Would need a whole new ballgame of calculations for golfie and his clan
If it keeps Golfie in work and busy then win/win
The pension industry will be affected and managing draw down will need more care. Most occupational schemes have a matching employer contribution so even at 25% relief it's still a no-brainer for most people.
In the gift scenario, one thing I've heard people do is have a dated letter signed between the donor and recipient declaring the money as a gift with no intention of it being paid back. And then a copy is left in attachment with the will, so that it helps the executors when they're going through the estate. That's what we're looking to do.
In the gift scenario, one thing I've heard people do is have a dated letter signed between the donor and recipient declaring the money as a gift with no intention of it being paid back. And then a copy is left in attachment with the will, so that it helps the executors when they're going through the estate. That's what we're looking to do.
if you are within the rules the date of transfer of funds will be evidence enough I would imagine?
Transfers made at the ‘11th hour’ can’t be readily justified I suppose as historic events however injust inheritance tax can be.
Whilst not wanting to turn this thread into anything remotely political, for those interested in Pensions it looks as if Labour have rowed back and will no longer be putting in their manifesto the bringing back of the LTA - one piece of good news this week!
My suspicion is this is a temporary relief only and something will be brought in at some stage but perhaps in a slightly different format.
Agree, I think flat tax relief is probably the easiest and most obvious change that will happen in future.
And justified. In my opinion it has always been perverse and not exactly progressive that a 20% tax payer gets 20% tax relief on pension contributions and a 45% tax payer gets 45% relief.
A flat rate of 25% would be sensible.
Don’t disagree, they’ll have to unravel salary sacrifice though otherwise will make zero difference so maybe not actually that easy!
I agree too. It is currently inequitable but as an incentive to reduce dependence on the state and force personal responsibility it has some merit.
The question in the election should be ‘what are your plans if any for pensions?’ To get an unambiguous response.
Whilst not wanting to turn this thread into anything remotely political, for those interested in Pensions it looks as if Labour have rowed back and will no longer be putting in their manifesto the bringing back of the LTA - one piece of good news this week!
My suspicion is this is a temporary relief only and something will be brought in at some stage but perhaps in a slightly different format.
Agree, I think flat tax relief is probably the easiest and most obvious change that will happen in future.
And justified. In my opinion it has always been perverse and not exactly progressive that a 20% tax payer gets 20% tax relief on pension contributions and a 45% tax payer gets 45% relief.
A flat rate of 25% would be sensible.
Agree not progressive. However wouldn't it do serious damage to the pensions industry. Only 25% relief when paying in but maybe taxed at 40% when drawn down. Would need a whole new ballgame of calculations for golfie and his clan
I think there are many people getting 40% tax relief on their pension contributions who then only pay 20% on the pension income in retirement.
This is where I think Labour will target it. Easy sell to the general public earning average income of £30kpa.
The last couple of years inflation numbers have really benefitted public sector workers mainly for the increase in their final salary / career average schemes. Those workers in the private sector with DC schemes wont have seen increases to their pensions of 8% last year.
In the gift scenario, one thing I've heard people do is have a dated letter signed between the donor and recipient declaring the money as a gift with no intention of it being paid back. And then a copy is left in attachment with the will, so that it helps the executors when they're going through the estate. That's what we're looking to do.
if you are within the rules the date of transfer of funds will be evidence enough I would imagine?
Transfers made at the ‘11th hour’ can’t be readily justified I suppose as historic events however injust inheritance tax can be.
Yes, I expect the bank accounts would show and make it clear - but getting a letter signed at least gives that concrete explanation of the purpose (ie - it’s a gift).
In the gift scenario, one thing I've heard people do is have a dated letter signed between the donor and recipient declaring the money as a gift with no intention of it being paid back. And then a copy is left in attachment with the will, so that it helps the executors when they're going through the estate. That's what we're looking to do.
if you are within the rules the date of transfer of funds will be evidence enough I would imagine?
Transfers made at the ‘11th hour’ can’t be readily justified I suppose as historic events however injust inheritance tax can be.
Yes, I expect the bank accounts would show and make it clear - but getting a letter signed at least gives that concrete explanation of the purpose (ie - it’s a gift).
That is a good idea.
just remember the gifts applying first if you passed within 7 years. You could inadvertently therefore make the gifts tax free but other parts of your estate taxed.
i dealt with an estate where one child had in effect had their inheritance pre death. Due to the tax on the remaining estate meant the remaining children inadvertently received less.
With just a few weeks to go, we're not looking as good this half year with everyone below where we currently are, but suspect everyone is happy that it's higher than all our predictions. Think TEL is running away with this.......
In the last couple of years I’ve been able to put some money away in an ISA with Vanguard and I’ve been impressed with them. I currently have my pension with Standard life and get charges of about £4,000 per year. I’m pretty much invested in US trackers with a couple of others thrown in. I’ve noticed the charges in a Vanguard SIPP are much lower and I think capped at £375. Worth switching? Seems like a no brainier but wondered if anyone had any thoughts to the contrary. I’ve overall been happy with Standard Life.
In the last couple of years I’ve been able to put some money away in an ISA with Vanguard and I’ve been impressed with them. I currently have my pension with Standard life and get charges of about £4,000 per year. I’m pretty much invested in US trackers with a couple of others thrown in. I’ve noticed the charges in a Vanguard SIPP are much lower and I think capped at £375. Worth switching? Seems like a no brainier but wondered if anyone had any thoughts to the contrary. I’ve overall been happy with Standard Life.
I switched to Vanguard 2 years ago. I like them, the only thing you have to be aware of is you are restricted to their funds, but not an issue for me on my main pension.
Yes fee's are very very good once you have a decent sized pot, saves me a good few thousand a year.
In the last couple of years I’ve been able to put some money away in an ISA with Vanguard and I’ve been impressed with them. I currently have my pension with Standard life and get charges of about £4,000 per year. I’m pretty much invested in US trackers with a couple of others thrown in. I’ve noticed the charges in a Vanguard SIPP are much lower and I think capped at £375. Worth switching? Seems like a no brainier but wondered if anyone had any thoughts to the contrary. I’ve overall been happy with Standard Life.
What charges are you paying ? Platform/policy charge ? Fund charge? And adviser fees ? If it's just the first 2 then you shouldnt really be paying much more than 1%....so I'm estimating your pension pot is c£400k ?
As @ Rob7Lee says, Vanguard might be cheap but they only offer their own funds. I wont comment further though as I'm not a great lover of tracker funds.
In the last couple of years I’ve been able to put some money away in an ISA with Vanguard and I’ve been impressed with them. I currently have my pension with Standard life and get charges of about £4,000 per year. I’m pretty much invested in US trackers with a couple of others thrown in. I’ve noticed the charges in a Vanguard SIPP are much lower and I think capped at £375. Worth switching? Seems like a no brainier but wondered if anyone had any thoughts to the contrary. I’ve overall been happy with Standard Life.
What charges are you paying ? Platform/policy charge ? Fund charge? And adviser fees ? If it's just the first 2 then you shouldnt really be paying much more than 1%....so I'm estimating your pension pot is c£400k ?
As @ Rob7Lee says, Vanguard might be cheap but they only offer their own funds. I wont comment further though as I'm not a great lover of tracker funds.
Why don’t you like tracker funds? I’m sure I read somewhere that 95% of managed funds don’t outperform the S&P 500 over long periods. You’d have to be pretty lucky picking one of the 5% that did outperform it. I was mistaken my charges are about 2.5k on a pot of 220k so a bit above 1%.
In the last couple of years I’ve been able to put some money away in an ISA with Vanguard and I’ve been impressed with them. I currently have my pension with Standard life and get charges of about £4,000 per year. I’m pretty much invested in US trackers with a couple of others thrown in. I’ve noticed the charges in a Vanguard SIPP are much lower and I think capped at £375. Worth switching? Seems like a no brainier but wondered if anyone had any thoughts to the contrary. I’ve overall been happy with Standard Life.
What charges are you paying ? Platform/policy charge ? Fund charge? And adviser fees ? If it's just the first 2 then you shouldnt really be paying much more than 1%....so I'm estimating your pension pot is c£400k ?
As @ Rob7Lee says, Vanguard might be cheap but they only offer their own funds. I wont comment further though as I'm not a great lover of tracker funds.
Why don’t you like tracker funds? I’m sure I read somewhere that 95% of managed funds don’t outperform the S&P 500 over long periods. You’d have to be pretty lucky picking one of the 5% that did outperform it. I was mistaken my charges are about 2.5k on a pot of 220k so a bit above 1%.
Depends what managed funds you are talking about.
I know lots of single asset funds that have outperformed a like minded tracker fund. Currently it's only US tracker funds that seem to outperform US active funds.
In the last couple of years I’ve been able to put some money away in an ISA with Vanguard and I’ve been impressed with them. I currently have my pension with Standard life and get charges of about £4,000 per year. I’m pretty much invested in US trackers with a couple of others thrown in. I’ve noticed the charges in a Vanguard SIPP are much lower and I think capped at £375. Worth switching? Seems like a no brainier but wondered if anyone had any thoughts to the contrary. I’ve overall been happy with Standard Life.
What charges are you paying ? Platform/policy charge ? Fund charge? And adviser fees ? If it's just the first 2 then you shouldnt really be paying much more than 1%....so I'm estimating your pension pot is c£400k ?
As @ Rob7Lee says, Vanguard might be cheap but they only offer their own funds. I wont comment further though as I'm not a great lover of tracker funds.
You not met Warren Buffet yet ;-)
I think for the vast majority of people who don't use an advisor Vanguard's funds are pretty good and certainly for me have performed exceptionally well the past two years, the anniversary coming up for two years and I've returned 28.78%. The S&P500 ETF is up over 40%.
In the last couple of years I’ve been able to put some money away in an ISA with Vanguard and I’ve been impressed with them. I currently have my pension with Standard life and get charges of about £4,000 per year. I’m pretty much invested in US trackers with a couple of others thrown in. I’ve noticed the charges in a Vanguard SIPP are much lower and I think capped at £375. Worth switching? Seems like a no brainier but wondered if anyone had any thoughts to the contrary. I’ve overall been happy with Standard Life.
What charges are you paying ? Platform/policy charge ? Fund charge? And adviser fees ? If it's just the first 2 then you shouldnt really be paying much more than 1%....so I'm estimating your pension pot is c£400k ?
As @ Rob7Lee says, Vanguard might be cheap but they only offer their own funds. I wont comment further though as I'm not a great lover of tracker funds.
You not met Warren Buffet yet ;-)
I think for the vast majority of people who don't use an advisor Vanguard's funds are pretty good and certainly for me have performed exceptionally well the past two years, the anniversary coming up for two years and I've returned 28.78%. The S&P500 ETF is up over 40%.
A tracker fund does what it says on the tin. Not many fund managers have beaten the S&P500 because of its growth over that period. But an investor shouldn't just be buying the S&P500 but having funds that cover worldwide equities, as well as Bonds and other assets. Great if you know what you are doing but not many people do.....or want the headache of doing so or tracking the returns.
Create a portfolio of ETFs that diversify your risk based on your own tolerance to risk.
Pretty easy for anyone who is financially literate.
Stay away from actively managed funds. They genuinely don't outperform the market in almost every case when fees are taken into account, and people that tell you otherwise often have a vested interest.
To give the other side, there are plenty of people wealthy enough to need an IFA who are financially illiterate.
Create a portfolio of ETFs that diversify your risk based on your own tolerance to risk.
Pretty easy for anyone who is financially literate.
Stay away from actively managed funds. They genuinely don't outperform the market in almost every case when fees are taken into account, and people that tell you otherwise often have a vested interest.
To give the other side, there are plenty of people wealthy enough to need an IFA who are financially illiterate.
Thank god for all those financially illiterate ones our there then 😂😂😂.
You obviously still have the fees from the ETF, but for the S&P 500 (IE00B3XXRP09) for example, they are about 0.09% a year.
I use IE00B6YX5C33. 0.03%.
Across my entire portfolio, 0.11% are my total fees on the portfolio below. And before people point out that it's a 100% equity high risk portfolio, I am 33, the portfolio totals about 15% of total household wealth and my diversification is elsewhere (albeit 15% of it in even more risky investments ). Up 6.3% since I started in Feb.
I use investengine and they don't charge any fees for stocks and shares ISA, they do for SIPPs though. Thoroughly recommend them.
You obviously still have the fees from the ETF, but for the S&P 500 (IE00B3XXRP09) for example, they are about 0.09% a year.
I still have a SIPP with Fidelity and kept a small amount in there, I use it to see if I can beat the funds with a bit of share trading (and so far winning! £28k has become £65k in the last 4 years), I used to have my main SIPP with them but at the time the fee's were a % and was quite expensive. My wife still has her SIPP and main S&S ISA with them.
Love the platform and a good company, used to pop into their investor centre on Cannon Street from time to time. When I managed a companies Pension we did a review and moved to them, streets ahead of the others on service. If you had over £250k you had your own personal contact, much like a private bank which I liked.
Interesting that a while back they changed their charges for ETF's making it very compelling, if that's all you invest in.
ii were also very good from an offering and cost perspective, they also pay a very good rate on cash compared to most.
You obviously still have the fees from the ETF, but for the S&P 500 (IE00B3XXRP09) for example, they are about 0.09% a year.
I use IE00B6YX5C33. 0.03%.
Across my entire portfolio, 0.11% are my total fees on the portfolio below. And before people point out that it's a 100% equity high risk portfolio, I am 33, the portfolio totals about 15% of total household wealth and my diversification is elsewhere (albeit 15% of it in even more risky investments ). Up 6.3% since I started in Feb.
I use investengine and they don't charge any fees for stocks and shares ISA, they do for SIPPs though. Thoroughly recommend them.
Good tips Huskaris. I'll look into IE00B6YX5C33, as it looks even cheaper than mine. Not sure if I will switch to investengine though as it would be a faff, but good to know.
I also started investing in that India ETF, it seems a bit less correlated than the other indices.
Hargreaves Lansdown being sold to Abu Dhabi wealth fund
Britain's biggest stock broker is on the brink of a £5.4 billion take-over by a consortium spearheaded by private equity firm CVC Capital and Abu Dhabi's wealth fund. Bosses at Hargreaves Lansdown have told investors they would "be willing to recommend" such a deal if the suitors lay down a firm offer.
Hargreaves Lansdown being sold to Abu Dhabi wealth fund
Britain's biggest stock broker is on the brink of a £5.4 billion take-over by a consortium spearheaded by private equity firm CVC Capital and Abu Dhabi's wealth fund. Bosses at Hargreaves Lansdown have told investors they would "be willing to recommend" such a deal if the suitors lay down a firm offer.
In layman terms what could this mean for my funds? I like the HL interface and have a reasonable amount invested via them but only one of their own funds. I'm tempted to go to another provider and open accounts with the providers of the funds I've invested in. Their dealer fee is high but other than that they have been fine especially for a relative novice like me
Comments
There is another assumption I've always made that you may be able to confirm or otherwise. First of all my estate goes solely to my wife and I know there is no IHT on that. However if I made a gift, die within 7 years of that gift, but my wife lives beyond the 7 years, then, am I right in saying, that there is no IHT on the gift made.
Transfers made at the ‘11th hour’ can’t be readily justified I suppose as historic events however injust inheritance tax can be.
This is where I think Labour will target it. Easy sell to the general public earning average income of £30kpa.
The last couple of years inflation numbers have really benefitted public sector workers mainly for the increase in their final salary / career average schemes. Those workers in the private sector with DC schemes wont have seen increases to their pensions of 8% last year.
just remember the gifts applying first if you passed within 7 years. You could inadvertently therefore make the gifts tax free but other parts of your estate taxed.
i dealt with an estate where one child had in effect had their inheritance pre death. Due to the tax on the remaining estate meant the remaining children inadvertently received less.
Still a long way to go, in market terms.
Yes fee's are very very good once you have a decent sized pot, saves me a good few thousand a year.
As @ Rob7Lee says, Vanguard might be cheap but they only offer their own funds. I wont comment further though as I'm not a great lover of tracker funds.
I know lots of single asset funds that have outperformed a like minded tracker fund. Currently it's only US tracker funds that seem to outperform US active funds.
I think for the vast majority of people who don't use an advisor Vanguard's funds are pretty good and certainly for me have performed exceptionally well the past two years, the anniversary coming up for two years and I've returned 28.78%. The S&P500 ETF is up over 40%.
Pretty easy for anyone who is financially literate.
Stay away from actively managed funds. They genuinely don't outperform the market in almost every case when fees are taken into account, and people that tell you otherwise often have a vested interest.
To give the other side, there are plenty of people wealthy enough to need an IFA who are financially illiterate.
https://www.fidelity.co.uk/estimate-my-fees/
You obviously still have the fees from the ETF, but for the S&P 500 (IE00B3XXRP09) for example, they are about 0.09% a year.
Across my entire portfolio, 0.11% are my total fees on the portfolio below. And before people point out that it's a 100% equity high risk portfolio, I am 33, the portfolio totals about 15% of total household wealth and my diversification is elsewhere (albeit 15% of it in even more risky investments
I use investengine and they don't charge any fees for stocks and shares ISA, they do for SIPPs though. Thoroughly recommend them.
Love the platform and a good company, used to pop into their investor centre on Cannon Street from time to time. When I managed a companies Pension we did a review and moved to them, streets ahead of the others on service. If you had over £250k you had your own personal contact, much like a private bank which I liked.
Interesting that a while back they changed their charges for ETF's making it very compelling, if that's all you invest in.
ii were also very good from an offering and cost perspective, they also pay a very good rate on cash compared to most.
I also started investing in that India ETF, it seems a bit less correlated than the other indices.
Britain's biggest stock broker is on the brink of a £5.4 billion take-over by a consortium spearheaded by private equity firm CVC Capital and Abu Dhabi's wealth fund. Bosses at Hargreaves Lansdown have told investors they would "be willing to recommend" such a deal if the suitors lay down a firm offer.