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Kirk Rice Blog

A Financial Planner’s View on the Autumn StatementWritten on November 23, 2023 by Kirk Rice LLP

So you don't have to; we took time to digest the recent Autumn Statement by Jeremy Hunt. The week's build-up bore rumours of abolishing inheritance tax and sweeping tax cuts; it was not to be. Given the seismic waves from just over a year ago and *That* mini-budget, perhaps the sensible and cautious approach should be celebrated.

From the individual’s perspective, the headline was National Insurance cuts for the employed and Self-employed. Many will welcome the 2% and 1% reduction, respectively, given the financial pressures that the last 18 months of inflation have caused.

In a similar sentiment, the National Living Wage (NLW) has given those on lower earnings a much-needed lift, rising from £10.42 p/h to £11.44. This is a 2010 policy commitment to lift the NLW to 2/3rds of median pay.

The government will no longer require individuals with income taxed only through Pay As You Earn to file a Self-Assessment return from 2024-25.

Something that was snuck into page 90 of the official statement document was a welcomed modernisation of Individual Savings Accounts (ISAs). The government changes effective in April 2024 will allow multiple subscriptions to ISAs of the same type within the same year. It did not, however, look to raise the yearly allowance of £20,000 available to save each year (something that has been frozen since 2017). There is also now a broader range of investments that can be held within the ISA wrapper, which could open some wider planning opportunities.

The minimum account-opening age for adult ISAs will be harmonised at 18, removing the current cash-only adult ISA for 16 to 17-year-olds. The £9,000 Junior ISA allowance is still available to children aged under 18.

Regarding pensions, the Lifetime Allowance (LTA) abolition was mentioned again, promising that clearer details on the practicalities of this legislation change will be circulated in the coming weeks. The new legislation effectively replaces the LTA with a tax-free cash allowance. The key point is that if someone has used all or part of their LTA between 2006 and 2024, this will be accounted for in their tax-free cash allowance going forward.

Download Our Autumn Statement Summary

Read our review of the key points of Jeremy Hunt's Autumn Statement broken down for individuals and businesses.

 

The final point I spotted is the 10-year extension to Enterprise Investment Scheme (EIS) and Venture Capital Trust (VCT) reliefs, as these were due to expire after 5th April 2025 and will now be in place until 2035. These are attractive to investors in new businesses as tax relief is available at 30% and 50% of qualifying investments.

If you would like to discuss any of the issues in the Autumn Statement and how they might affect you or require any other financial planning assistance, please email info@kirkrice.co.uk to arrange a call with one of our Financial Planners. Kirk Rice offers a free no, obligation first meeting and fees and costs of work involved would be discussed. We do not carry out any work without your consent and agreement to fees.

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Please note: our articles are for general guidance on the date of publication only and, specific advice should be taken before acting on any of the suggestions made.

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