Here is a brief look at the Budget 2016 Summary highlighting some key points that relate to the recent changes in Government policy from the Chancellors speech on 16 March 2016 Budget 2016 Summary. The opportunity remains to increase pension funding between now and 5th April 2016 and beyond to benefit from higher rates of tax relief.
Salary sacrifice is also still available – the Government confirmed it intends pension saving to continue to benefit from income tax and national insurance relief when provided through salary sacrifice.
The lifetime allowance reduction from £1.25 million to £1 million and the restricted (tapered) annual allowance for high income individuals will come in to effect on 6th April 2016 as planned.
Also in the Budget 2016 Summary, A new Lifetime ISA will be introduced for the under 40s from 6th April 2017, with a Government bonus of 25%. The overall annual ISA subscription limit (including the Lifetime ISA) will be increased to £20,000 from 6th April 2017.
Capital Gains Tax
Higher and basic rates of CGT will be reduced from 28% to 20% and from 18% to 10%, from 6th April 2016 – but not for certain residential property such as buy to let and second homes.
Budget 2016 Summary
Further reading on pensions and how it relates to the Budget can be viewed Here
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