Posted by: WealthIFA | March 23, 2012

Financial News & Budget Update we 23/03/2012

So, how was it for you then?…

Let’s face it, from a financial perspective, the budget must be one of the most eagerly awaited and yet, at the same time, most thankless of tasks each year.

Never an easy balancing act and there will always be winners & losers – this year it is the elderly who it would appear at first glance, that lose out.

HMRC suggests that, taking inflation into account, the budget freeze on age related allowances will leave 4.41 million people worse off than they would have expected, by an average of £83 a year in 2013-14, with those due to turn 65 after 5 April 2013 missing out on an average of £285 compared with what they expected in 2013-14. They estimate the biggest losses to be in the region of £322.
 
The chancellor has been quick to state that nobody will have cash taken away from them that they had already received and they would not be worse off “in cash terms”.

The numbers probably need a bit more crunching on this one but the Institute for Fiscal Studies does appear to (almost) corroborate this view point saying that both poor and well-off pensioners would not be affected. Those about to turn 65 would be the ones that lost the most although, when the higher personal allowance for everyone was taken into account, the losses were “much reduced”.

They calculate that pensioners will lose on average about one quarter of 1% of their income in 2014.”
 
The headlines concentrated on the so called “granny tax” of the budget but there were other announcements made with only a brief mention of the social care white paper that is expected soon as well as a number of measures to reduce tax avoidance.

The BBC have launched a Budget calculator for those interested to see how the Budget 2012 affects them at http://bbc.in/GIIZAe

Hopefully it’s not too bad for you?… Have a great weekend!

This Week …

Estate Planning

Budget 2012: Treasury closes property-based IHT avoidance schemes: http://bit.ly/GIzqDx
Budget 2012: More to pay higher-rate tax, says IFS http://bbc.in/GMJQ2H

Long Term Care

How can health and social care be encouraged to integrate?: http://bit.ly/GHSyA1
MP urges gov’t to act on long-term care crisis: http://bit.ly/GQ4fVj

Retirement

ISA or Pension? The choice is yours: http://bit.ly/FOOUp7
Budget 2012: anger as pensioners suffer £3.5bn tax break raid: http://bit.ly/GKKFqz
Budget 2012: Ministers under fire over tax allowances for pensioners http://bbc.in/GJEDKm
‘Granny tax’ Q&A: Pensioner allowances explained http://bbc.in/GFFld7

Investment

ISA or Pension? The choice is yours: see Retirement above
ISA savings system shake-up urged: http://bit.ly/zvUbym

Regards
Kieron

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