Key Facts 2023/24

You can invest in an Individual Savings Account (ISA) which is free from income tax and capital gains tax. The amount you may invest or save in a single year, your 'annual ISA allowance', is limited. This annual allowance is currently £20,000.

If you are a UK resident over 16 years of age, you may save up to a certain amount of money per year. This amount is your 'ISA Allowance'. Money in your ISA is free from income tax and capital gains tax.
Nonetheless, you cannot apply losses on share investments in your ISA to offset capital gains on other investments.

There are several types of ISAs. The most common are - Cash ISAs and Stocks & Shares ISAs.
In addition to these two – ISAs are available for other purposes.
Three such accounts are:
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 The Lifetime ISA. This is designed for people who are are under 40 who want to save money towards the purchase of their first home or for retirement. (Lifetime ISAs are not available through St. James's Place.)
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 The Junior ISA. This is an account for those who wish to save money tax efficiently for their children.

 Help to Buy ISA. Designed for mortgage first-time buyers. You can save up to £200 per month, with a maximum of £12,000. This is in addition to the £20,000 ISA allowance. Please note, this ISA has been closed to new applicants since 2019.

You can pay in your entire ISA allowance of £20,000 into any one or any combination of ISAs. You cannot, however, deposit money into two ISAs of the same type – for example, into two Stocks and Shares ISAs – during the same tax year. You would have to wait for the next tax year to deposit into a second Stocks and Shares ISA.

Investments can be a complex matter, and therefore if you have any questions, please don't hesitate to get in touch with us. You can contact us here.

The value of an investment with St. James's Place will be directly linked to the performance of the funds you select and the value can therefore go down as well as up.  You may get back less than you invested.
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The favourable tax treatment of ISAs may not be maintained in the future and is subject to changes in legislation.

Cash ISAs are not available through St. James’s Place.

Investing in a pension is an excellent way to save for retirement and is very tax efficient. If you have not invested in a pension or other saving accounts, you will have to rely solely on the State Pension in retirement, and it is not incredibly generous! The State Pension currently pays £203.85 a week, and you would only get this maximum if you have made National Insurance contributions for at least 35 years. More information regarding the State Pension is available here: www.gov.uk/new-state-pension/overview 
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Please note that clicking a link will open the external website in a new window or tab. Links from this website exist for information only and we accept no responsibility or liability for the information contained on any such sites. The existence of a link to another website does not imply or express endorsement of its provider, product or services by us or St. James's Place.
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You can set up a personal pension to help contribute to your retirement savings. A personal pension can be beneficial for business owners who are not contributing to a workplace pension, but anyone can have one. Two types of workplace pension plans are currently available. The 'final salary' (defined benefit) pension has been on the decline due to costs. Most savers now have a 'money purchase' (defined contribution) pension. Company pensions are maintained by employers, and both employers and employees contribute to them. 

‍What happens if I change jobs?
‍If you leave an employer, your workplace pension continues, and the value of your savings within the pension will hopefully increase over time. You do not actually have to do anything – the pension can stay where it is, and it should be perfectly secure until your retirement. You should, however, be kept informed about its value with annual statements from the pension provider. It may also be helpful for a financial adviser to review your existing provisions to check if they are working as hard as they possibly can for you.

‍What is the 'Annual Allowance'?
‍The annual allowance is the maximum amount of money you can pay into a pension and receive tax relief. The annual tax-year (2023/24) allowance is currently limited to £60,000. However, you are also limited by your annual income, at either 100% of your income earnings or a gross sum of £3,600, whichever sum is greater.  

For those who earn more than £260,000, the annual allowance is reduced by £1 for every £2 of excess adjusted income. So, if you earned £360,000, your annual allowance would amount to only £10,000. 

The money purchase annual allowance (MPAA) comes into play should you already be receiving pension income, which would reduce your annual allowance to £10,000 from £60,000. 

You may, however, in most circumstances apply unused allowances from three prior tax years, beginning with the first prior year. In this way, you can increase your pension contribution in excess of the current tax year's allowance.

Pensions can be a complex matter, and therefore if you have any questions, please don't hesitate to get in touch with us. You can contact us here.

The value of a pension  with St. James's Place will be directly linked to the performance of the funds you select and the value can therefore go down as well as up.  You may get back less than you invested.

The levels and bases of taxation and reliefs from taxation can change at any time. The value of any tax relief depends on individual circumstances.

Inheritance tax (IHT) is a tax levy on the total estate value whenever someone dies. The estate value would include the total value of property, money and other possessions.

IHT should not be an issue if:
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 Your entire estate is valued below the current IHT threshold of £325,000 (this threshold is called the "nil-rate band")
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 You leave your entire estate to a beneficiary exempt from the IHT. Charities and community amateur sports clubs are examples of this. 

If your estate is valued in excess of £325,000, then the value above this threshold might be taxed at a rate of up to 40%. 

Homeowners also have an additional allowance called the residence nil rate band (RNRB), which is currently set at £175,000 if the residence is left to their children or other direct descendants. Together with the personal £325,000 nil rate band (NRB), amounts to a £500,000 allowance. According to the March 2021 Budget announcement, these nil rates bands are to remain at their current levels at least until 2028. The RNRB only applies to a residence left to you children or other direct descendants.

The residence nil-rate band is reduced by £1 for every £2 by which an estate exceeds the £2million threshold.

There are currently significant perks for married persons and civil partners:
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 Anything a spouse or civil partner receives is IHT free, no matter the amount even if they receive the entire estate. 
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 A spouse's or civil partner's nil-rate band is transferable, which means that the inheritor can benefit from a deceased spouse's or civil partner's unused nil-rate and resident nil rate bands.

Several benefits apply whenever you transfer money or property as an outright gift before death. You might also do this to relieve yourself of the maintenance of property or investments that you give away. Under certain conditions, gifting could also serve to reduce your inheritance tax (IHT) liability. Rules on gifting can be complex, and we recommend taking advice before making gifts.  

The levels and bases of taxation and reliefs from taxation can change at any time. The value of any tax relief depends on individual circumstances.

‍When must the IHT be paid?
‍Inheritance tax is usually due at the latest of six months after the death of the estate holder. HMRC will charge interest on the tax due after the deadline passes.

Inheritance tax can be a complex matter, and therefore if you have any questions, please don't hesitate to get in touch with us. You can contact us here.