Top 5 financial things to do before labour get in?
Discussion
Thanks, I had a similar small exchange programme back in 2006 when I was in university at ETH Zurich, I must say I was blown away by tech and knowledge they got. I guess it is all location specific, but again even than somewhere like Zurich was no similar to studying in London. I have no doubt about the UK universities or schools in particular but I think judging by all expenses making me question is it worth it anymore? Perhaps for someone who come from overseas to study and get more critical and independent views is different.
ooid said:
Thanks, I had a similar small exchange programme back in 2006 when I was in university at ETH Zurich, I must say I was blown away by tech and knowledge they got. I guess it is all location specific, but again even than somewhere like Zurich was no similar to studying in London. I have no doubt about the UK universities or schools in particular but I think judging by all expenses making me question is it worth it anymore? Perhaps for someone who come from overseas to study and get more critical and independent views is different.
The last time I looked ETH Zurich was just outside the top ten universities in THE's global rankings, with the top ten dominated by Oxbridge, USA and London (Imperial, UCL). It's the highest ranked non-USA non-UK institution.https://www.timeshighereducation.com/world-univers...
ETA not UCL, they dropped more than I remembered
Edited by turbobloke on Wednesday 5th June 09:46
Michael_B said:
Precisely. Prepayment won’t make jot of difference to the VAT rate in force at the time the services are delivered, in this case, educational ones.
As a comparison, as of January 2024 the basic VAT rate here in Switzerland moved from 7.7% to 8.1%, as voted by the people in a referendum in order to provide extra finance for state pensions.
For customers with annual service contracts (often not Jan-Dec) we were obliged to invoice the period up to 31.12.23 at the old rate, and after that at the new one.
Some idiot customers were insisting that by prepaying in December for Jan/Feb deliveries, we could invoice them at the old rate. We politely informed them that the law is very clear, and that it would not make the slightest difference and their invoices would indeed be made at the prevailing rate at the moment of delivery.
Switzerland isn’t the UK, but such basic accounting principles are pretty much the same the world over.
Interestingly, in the years when Singapore increased its GST from 7% to 8% (2023) and then 8% to 9% (2024) lots of firms were allowing people to prepay car insurance, health insurance, car servicing ahead of the increases.As a comparison, as of January 2024 the basic VAT rate here in Switzerland moved from 7.7% to 8.1%, as voted by the people in a referendum in order to provide extra finance for state pensions.
For customers with annual service contracts (often not Jan-Dec) we were obliged to invoice the period up to 31.12.23 at the old rate, and after that at the new one.
Some idiot customers were insisting that by prepaying in December for Jan/Feb deliveries, we could invoice them at the old rate. We politely informed them that the law is very clear, and that it would not make the slightest difference and their invoices would indeed be made at the prevailing rate at the moment of delivery.
Switzerland isn’t the UK, but such basic accounting principles are pretty much the same the world over.
Financial Times said:
The Institute for Fiscal Studies, an influential think-tank, this week argued there was a case for Labour to “swiftly” reintroduce the LTA, which was scrapped by Conservative chancellor Jeremy Hunt in April this year. “The pensions tax regime is still overly generous to those who already have big pensions, those with high retirement incomes and those getting big employer pension contributions,” the IFS said in a paper published this week. “There is therefore a case for Labour’s proposed reinstatement of the lifetime allowance and, were Labour to form the next government, it would be best advised to implement any reform swiftly.”
The think-tank said there were other ways Labour could “improve” the system. One option would be to reinstate the LTA at a higher value than its old level, while also cutting the amount of pension savings from which 25 per cent can be taken free of income tax after the age of 55. It added there should also be a new limit on the amount of pension that can be bequeathed free of inheritance tax — ideally zero, but any limit would be an improvement, it said.
“A reinstated lifetime allowance should also be less generous for defined benefit pensions (relative to defined contribution pensions) than the one that was in place from 2006 to 2022, and particularly so for those who take their defined benefit pensions earlier,” said the IFS. “It would also be worth considering reintroducing the lifetime allowance as a cap on contributions to defined contribution pensions and accrued benefits in defined benefit pensions, rather than on the pensions’ estimated value.”
“We haven’t seen the manifestos yet, and even when we do they might not contain much concrete detail on pensions, inheritance tax or the taxation of investments,” said Gary Smith, partner in financial planning at wealth management firm Evelyn Partners.
The think-tank said there were other ways Labour could “improve” the system. One option would be to reinstate the LTA at a higher value than its old level, while also cutting the amount of pension savings from which 25 per cent can be taken free of income tax after the age of 55. It added there should also be a new limit on the amount of pension that can be bequeathed free of inheritance tax — ideally zero, but any limit would be an improvement, it said.
“A reinstated lifetime allowance should also be less generous for defined benefit pensions (relative to defined contribution pensions) than the one that was in place from 2006 to 2022, and particularly so for those who take their defined benefit pensions earlier,” said the IFS. “It would also be worth considering reintroducing the lifetime allowance as a cap on contributions to defined contribution pensions and accrued benefits in defined benefit pensions, rather than on the pensions’ estimated value.”
“We haven’t seen the manifestos yet, and even when we do they might not contain much concrete detail on pensions, inheritance tax or the taxation of investments,” said Gary Smith, partner in financial planning at wealth management firm Evelyn Partners.
Salted_Peanut said:
Financial Times said:
The Institute for Fiscal Studies, an influential think-tank, this week argued there was a case for Labour to “swiftly” reintroduce the LTA, which was scrapped by Conservative chancellor Jeremy Hunt in April this year. “The pensions tax regime is still overly generous to those who already have big pensions, those with high retirement incomes and those getting big employer pension contributions,” the IFS said in a paper published this week. “There is therefore a case for Labour’s proposed reinstatement of the lifetime allowance and, were Labour to form the next government, it would be best advised to implement any reform swiftly.”
The think-tank said there were other ways Labour could “improve” the system. One option would be to reinstate the LTA at a higher value than its old level, while also cutting the amount of pension savings from which 25 per cent can be taken free of income tax after the age of 55. It added there should also be a new limit on the amount of pension that can be bequeathed free of inheritance tax — ideally zero, but any limit would be an improvement, it said.
“A reinstated lifetime allowance should also be less generous for defined benefit pensions (relative to defined contribution pensions) than the one that was in place from 2006 to 2022, and particularly so for those who take their defined benefit pensions earlier,” said the IFS. “It would also be worth considering reintroducing the lifetime allowance as a cap on contributions to defined contribution pensions and accrued benefits in defined benefit pensions, rather than on the pensions’ estimated value.”
“We haven’t seen the manifestos yet, and even when we do they might not contain much concrete detail on pensions, inheritance tax or the taxation of investments,” said Gary Smith, partner in financial planning at wealth management firm Evelyn Partners.
The think-tank said there were other ways Labour could “improve” the system. One option would be to reinstate the LTA at a higher value than its old level, while also cutting the amount of pension savings from which 25 per cent can be taken free of income tax after the age of 55. It added there should also be a new limit on the amount of pension that can be bequeathed free of inheritance tax — ideally zero, but any limit would be an improvement, it said.
“A reinstated lifetime allowance should also be less generous for defined benefit pensions (relative to defined contribution pensions) than the one that was in place from 2006 to 2022, and particularly so for those who take their defined benefit pensions earlier,” said the IFS. “It would also be worth considering reintroducing the lifetime allowance as a cap on contributions to defined contribution pensions and accrued benefits in defined benefit pensions, rather than on the pensions’ estimated value.”
“We haven’t seen the manifestos yet, and even when we do they might not contain much concrete detail on pensions, inheritance tax or the taxation of investments,” said Gary Smith, partner in financial planning at wealth management firm Evelyn Partners.
I retired in my early 50's and my SIPP was getting to a level where it could easily hit LTA with a few more years compound growth and high contributions. At the same time LTA was reducing real terms, and sometimes actual terms.
When ordinary people are having to plan for years of retirement the rules should be relatively easy to understand, and have some degree of certainty and stability.
Planning anything specifically on Pensions is verging on impossible because literally anything could happen from nothing to a lot.
Labour will need to raise money and the 2 easiest targets remain Pensions and IHT followed by CGT.
Taxing people who have planned and saved for the future seems wrong but given the Nation is divided into have and have nots , sympathy for the haves will be in short supply.
As such all you can do is what feels right for you.
I’m not 100% convinced that taking the entirety of my 25% in tfc now is necessarily the right thing to do but equally I do not want to run the risk of not doing it and then regretting it.
Labour will need to raise money and the 2 easiest targets remain Pensions and IHT followed by CGT.
Taxing people who have planned and saved for the future seems wrong but given the Nation is divided into have and have nots , sympathy for the haves will be in short supply.
As such all you can do is what feels right for you.
I’m not 100% convinced that taking the entirety of my 25% in tfc now is necessarily the right thing to do but equally I do not want to run the risk of not doing it and then regretting it.
alscar said:
Labour will need to raise money and the 2 easiest targets remain Pensions and IHT followed by CGT.
It would highly counter productive to attack private pensions given the bigger people's personal pots the more room there is to reduce/cap/not increase the state pension. However, CGT and IHT are fairly legitimate targets given that they are arise largely from un-earnt income and the tax raised can/should be used to help reduce the inequality which exists as a result of asset inflation. At the very least CGT should be the same level as income tax, and IHT should be much higher.
Condi said:
It would highly counter productive to attack private pensions given the bigger people's personal pots the more room there is to reduce/cap/not increase the state pension.
Labour have form for this, and also know how much their voters like it when they increase the inequality on taxes even further.https://www.thisismoney.co.uk/money/comment/articl...
snotrag said:
Hustle_ said:
Shall we just re-name this thread "Paying for Public School" or something.
PH operates in an alternate timeline to 'real life'. Indeed the thread is mostly panic based on empty speculation that Labour will have us all driving Ladas
Ken_Code said:
Labour have form for this, and also know how much their voters like it when they increase the inequality on taxes even further.
https://www.thisismoney.co.uk/money/comment/articl...
It wasn't really an attack on pensions, it was removing a tax benefit offered to pensions which no other financial instrument got. https://www.thisismoney.co.uk/money/comment/articl...
Condi said:
It wasn't really an attack on pensions, it was removing a tax benefit offered to pensions which no other financial instrument got.
Semantics. It was a change in how pensions are taxed to increase tax payable on them which is exactly what people are suggesting they can imagine happening again.Condi said:
It would highly counter productive to attack private pensions given the bigger people's personal pots the more room there is to reduce/cap/not increase the state pension.
However, CGT and IHT are fairly legitimate targets given that they are arise largely from un-earnt income and the tax raised can/should be used to help reduce the inequality which exists as a result of asset inflation. At the very least CGT should be the same level as income tax, and IHT should be much higher.
I don’t know the splits raised but not all IHT raised is via landed gentry and fat cats. However, CGT and IHT are fairly legitimate targets given that they are arise largely from un-earnt income and the tax raised can/should be used to help reduce the inequality which exists as a result of asset inflation. At the very least CGT should be the same level as income tax, and IHT should be much higher.
I imagine a fair bit is from ordinary people that have worked hard for their money.
Equally CGT is chargeable obviously on gains but again I guess quite a bit of which is via people that have invested already taxed earnings.
Whilst it would seem counter productive to raise more tax from the private sector pensions , in reality they can do little or nothing about it and as I said no one else will care.
The fact is that no one knows ( labour certainly won’t be saying anything as yet )but I just don’t see where else monies can be raised.
Other than council tax rises and general wealth tax which supposedly ruled out.
alscar said:
I don’t know the splits raised but not all IHT raised is via landed gentry and fat cats.
The landed gentry are often exempt...... https://www.gov.uk/guidance/agricultural-relief-on...I have popped into this thread several times looking for some inspiration as to some smart plays knowing that Labour is coming. Unfortunately, the whole thread fails to deliver - i.e. there are not 5 things...... let alone a top 5.
I thought I'd summarise where I am to try and get some more suggestions going:
I've decided this year to salary sacrifice a big chunk into my pension. I am continuing with this on the assumption that:
a) you can only play the current tax situation game and not the unknown future one so make the most of the current 60K allowance
b) If they do bring back in the LTA, then I might be screwed and regret it, but I can stop paying in at that point, having "overpaid" this year.
c) They have said no to Income tax and NI rises so worst case if I do stop paying in at that point, I won't lose any more that I would do if I didn't pay it in now.
Private skool wise, we have 1 who would be going to PS in 18 months' time. - We have scratched that idea and instead we are now planning to temporarily move to a better catchment for a year. Total cost of renting and moving for a year (roughly £20K) being a better option - so put us down as one of those that will be costing the state more thanks to the PS VAT envy tax.
Other than that, I haven't got anything else - Apart from hoping that Sunak's 2K lie is actually about right and that it won't cost us much more than that......
I thought I'd summarise where I am to try and get some more suggestions going:
I've decided this year to salary sacrifice a big chunk into my pension. I am continuing with this on the assumption that:
a) you can only play the current tax situation game and not the unknown future one so make the most of the current 60K allowance
b) If they do bring back in the LTA, then I might be screwed and regret it, but I can stop paying in at that point, having "overpaid" this year.
c) They have said no to Income tax and NI rises so worst case if I do stop paying in at that point, I won't lose any more that I would do if I didn't pay it in now.
Private skool wise, we have 1 who would be going to PS in 18 months' time. - We have scratched that idea and instead we are now planning to temporarily move to a better catchment for a year. Total cost of renting and moving for a year (roughly £20K) being a better option - so put us down as one of those that will be costing the state more thanks to the PS VAT envy tax.
Other than that, I haven't got anything else - Apart from hoping that Sunak's 2K lie is actually about right and that it won't cost us much more than that......
alscar said:
I don’t know the splits raised but not all IHT raised is via landed gentry and fat cats.
I imagine a fair bit is from ordinary people that have worked hard for their money.
Equally CGT is chargeable obviously on gains but again I guess quite a bit of which is via people that have invested already taxed earnings.
I would guess that most people paying IHT are doing so because of an increase in house prices, which is entirely unearnt income. The money they have "made" has been made off the back of the next person buying it, it hasn't come from nowhere, so should be taxed. I imagine a fair bit is from ordinary people that have worked hard for their money.
Equally CGT is chargeable obviously on gains but again I guess quite a bit of which is via people that have invested already taxed earnings.
Similarly a lot of CGT is from BTL assets or whatever, for most people their savings will be in ISA wrappers. You can't really argue that if someone has made £100k from a £20k investment (eg leveraged property), that they should pay a low rate of tax on that because the first £20k was taxed at source. We are in the daft situation whereby buying things and sitting on them is more tax efficient than going out to work.
Gassing Station | Finance | Top of Page | What's New | My Stuff