Welcome to your November update from Team DFP! In this issue, we’ll assess the increase in Inheritance Tax payments; talk a bit about Will Aid and how it works; and we’ll take a closer look at the rise in the Normal Minimum Pension Age, which was confirmed earlier this month. As always though, we’ll begin with our monthly message from Liam Winstanley. Enjoy.
A message from our Director…
Welcome to November’s newsletter, in which we have articles focusing on the government’s increased Inheritance Tax receipts and the rise in the minimum pension access age… both of which we may find somewhat depressing!
Whilst unwelcome, though, I must remember that these ‘1st world issues’ help people like me earn a living. Here at DFP, our aim is to provide independent financial planning advice to individuals and families trying to plot a sensible route through their financial lives. These things also act as a reminder, as we approach Christmas, that there are people with far more fundamental worries than our own.
I was therefore delighted to hear from our very own Sharon Kennedy that we’d been successful in securing a £1,000 donation from Skipton Building Society to The Streetlife Trust, who have been providing essential support for homeless people around the Blackpool area for nearly 40 years.
Anyway, I’ll let you enjoy the newsletter and I hope that you and your families are able to stay safe and well as we head towards the festive season.
In the news this month…
HMRC recently released their Inheritance Tax receipts for the period between April and October 2021, with figures showing that the government collected £600m more than during the same period in 2020 - £3.6bn in total. The BRI Wealth Management’s ‘Head of Wealth Management Advice’, Andrew Gillett, told the Express he was ‘not surprised’ at the increase, citing rising house prices and the freezing of Inheritance Tax thresholds and allowances.
He also explained how certain reliefs and exemptions could be targeted over the coming months and years, warning people to remain vigilant. “It’s likely more families will pay Inheritance Tax in the coming years due to the freezing of allowances until 2026,” he said. “Pre-pandemic, there were several reports published by the ONS and an All Party Parliamentary Group suggesting that there could be reforms including amendments to lifetime gifts, the interaction of CGT with other allowances such as business and agricultural property relief, and also exemptions.” Read more, here.
Elsewhere, in the world of investment, a new partnership between iconic engine makers Rolls-Royce and the Gulf state of Qatar has promised to invest billions into green engineering projects to help fund entrepreneurs exploring new ways to support the transition to net zero. A deal between the two entities will create around 1,000 jobs at two campuses - one based in Qatar, and the other located here in northern England. It’s hoped that a further 10,000 roles will then be created by the businesses launched at the campuses, as well as in the clean-tech economy more broadly. And, according to the Guardian, the goal is for “five ‘unicorn’ companies - private firms valued at more than $1bn - to be created at the centres by 2030, rising to 20 by 2040,” providing sizable returns to investors.
Staying with investments, and research from ‘FE fundinfo’, which has revealed that UK equity funds are outperforming their peers in industry on ESG scores. Published this month, the 2021 FE fundinfo ESG Market Review showed that the average UK equity fund had a score of 8.6 based on MSCI's ratings process. That’s about two points higher than those with a global or regional focus. The report also found that nearly 98% of UK equity funds were classed as ‘ESG leaders' compared with less than 40% of global and regional funds. Read more here.
Finally, this month is Will Aid month, providing you with a great opportunity to get a professionally written Will while supporting a good cause. Will Aid is a special partnership between the legal profession and nine of the UK’s biggest and best-loved charities (incl. Age UK, Action Aid, Save the Children, and the NSPCC). Every November, participating solicitors volunteer their time - and waive their fees - for writing basic Wills. They instead invite clients to make voluntary donations to Will Aid.
You’ll get a professionally drawn-up Will, while the charities receive much-needed donations for their amazing work. Everyone’s a winner. But hurry, you only have until the end of the month to get involved. Click here to find out more.
This month’s featured article…
As more and more of us are living longer and spending a larger proportion of our lives in retirement, it’s unsurprising to see that the State Pension and Normal Minimum Pension Ages are on the rise too. The headline is, the Normal Minimum Pension Age - that’s the age from which someone in the UK can draw benefits from a private pension - is set to increase from 55 currently, to 57 from April 2028.
Scheme operators do have the option to choose how to implement the increase in advance of April 2028. Providing they notify their members of the increase, they can enforce it beforehand. Beyond 2028, it’s anticipated that the government will try and keep the minimum pension age for private pensions consistent at around ten years below the State Pension age.
As you’d imagine, there are lots of conditions and permutations surrounding the legislation. For instance, it’s worth noting that this change will not affect those with ‘uniformed services pension schemes’ (i.e. firefighters, police officers, armed forces personnel). Furthermore, those born between April 1971 and April 1973 - who’ll be aged between 55 and 57 when the legislation comes in - could be adversely affected by the change if they haven’t taken all their private pension benefits before April 2028. They may even need to wait as long as two years before they can take the remainder of their benefits. It could also impact people who take their benefits in stages using a phasing option or a drip-feed drawdown facility.
In short, professional advice on this is a must. If you’re concerned about your private pension and how it may be affected by these developments, talk to Liam and the team today!
On a lighter note…
A couple of months ago, our friends at Skipton Building Society (SBS) asked brokers to put forward local charities and foundations for their fabulous Community Giving scheme, which gave away forty donations to good causes across the country. We were delighted to be amongst those fortunate enough to be selected, with a whopping £1,000 going to our nomination: The Streetlife Trust. Below is our Mortgage & Protection Specialist, Sharon Kennedy (left), and SBS’s Business Development Manager for the North West, Carley Harrison (right), presenting the donation to Streetlife’s Julie Foden.
Established almost forty years ago, The Streetlife Trust are a fantastic organisation who provide vital support to homeless and vulnerable young people in Blackpool and the surrounding areas. They provide assistance for those up to the age of 26 from several locations which also serve as emergency accommodation for those who need it. To find out more about Streetlife, and the crucial services they provide, take a look below.
The Streetlife Trust: ‘We Are Streetlife’
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Sam Wright is Danbro’s Marketing Manager. He produces regular content and feature articles on our digital and non-digital channels – and social platforms – for the Danbro Group and its subsidiaries, as well as having responsibility for the Company’s internal and external communications.
His background is in Journalism and Creative Writing, having previously contributed to publications such as The Daily Post, The Lancashire Evening Post, and The Blackpool Gazette.
He is a keen swimmer and avid Manchester United fan (but don’t hold that against him), and he lives in Lancashire with his wife, Sarah.