Market update
- Gold reaches a new all-time high, doubling in value over the last two years – driven by diversification away from the US dollar, heightened geopolitical uncertainty, and concerns over unchecked fiscal spending.
- Global markets remain reactive to a mix of economic and geopolitical signals, with recent moves reflecting uncertainty around inflation, growth, and policy direction. While corporate earnings have held up in many regions, investor sentiment has become more cautious.
- he next Bank of England rate announcement is due on 6 November.
Is inheritance tax planning more important than ever?
It’s a question worth asking – especially now. With inheritance tax (IHT) nil-rate bands frozen until 2030 and asset values continuing to rise, more families are finding themselves unexpectedly caught in the IHT net. This is sometimes called ‘fiscal drag’ and is affecting more people, as even modest estates could face significant tax liabilities.
In addition, in the Autumn Budget last year the Chancellor proposed that most unused pension funds and death benefits will be brought into the scope of inheritance tax from April 2027. This marks a major shift in estate planning strategy. Previously, pensions were largely exempt from IHT, making them a valuable tool for passing on wealth. Under the new rules, any unused pension savings could be taxed at 40% if they exceed the nil-rate band, unless passed to a spouse, civil partner, or registered charity.
And we don’t yet know whether there will be IHT changes in the upcoming 26 November Budget.
IHT contributed £8.2bn to government revenue last financial year. And the Office for Budget Responsibility estimates IHT receipts will rise to a record of £9.1bn this financial year and hit £14.3bn by the 2029/30 tax year.
Reviewing your estate, pension nominations and approach to gifting could help ease future tax liabilities. Please get in touch if you’d like to discuss inheritance tax planning so that you can help protect your legacy.
Is ‘unretirement’ the new buzz word?
Stepping back into work after officially ‘retiring’ is an actual concept which seems to be growing in popularity.
‘Unretirement’ is when someone returns to work after retiring – part-time, freelance or to start a business. It’s all about choice – deciding to do something more enjoyable, or less stressful or being more flexible to allow time for family or hobbies.
It’s not really surprising as people are living longer, healthier lives and there is more flexibility around working remotely. And of course, the extra income helps to supplement retirement savings.
- If you’re planning to ‘unretire’ there are a few things to consider:
- Extra earnings could take your income above the personal tax threshold or push you into a higher tax bracket
- It’s important to make the most of any tax reliefs and allowances available to you
Watch out for the money purchase annual allowance (MPAA), which limits pension contributions, if you’ve already started accessing your pension Tax rules can change and the impact of taxation and any tax reliefs depends on your circumstances, including where you live.
If you’re currently working in retirement or plan to do so, I can help you structure your finances in the most tax-efficient way and ensure you’re making the most of your allowances. Please get in touch if you’d like help with this.
Coming soon: Talk Money Week – 3 to 7 November
Talk Money Week encourages people across the UK to talk about their finances – from pocket money to pensions – and to talk openly and with confidence.
People who talk about money have been found to make better and less risky financial decisions, feel less stressed and more in control of their financial situation.
We’ve been focusing on encouraging conversations with family in particular, in recent emails. Here’s a reminder of our top tips on talking money with teens as well as our guide on opening up financial conversations with your adult children and loved ones.
Why not make a special effort in the run up to and during Talk Money Week to have a conversation with a family member or friend.
If you have any questions about this email, or anything else, please get in touch – I’m here to help.