April 2017- New Advice Allowance being introduced
Current Accounting News– When you receive advice from an advisor regarding financial planning in retirement, you will usually need to pay an advisor directly. Due to a new advice allowance being introduced this month, you will be able to use funds saved in a defined contribution type pension plan to pay for the advice. Effectively this makes the advice tax free.
Formerly, if any funds were withdrawn for anything other than very narrowly defined pension’s advice, there would be a tax charge of 55% as the withdrawal of these funds would be classed as an unauthorised payment. This meant that many individuals would not seek advice at all as this cost discouraged them. Research from the Government also showed that only a small percentage of people knew what their pension pot was worth and an even smaller percentage would be okay with planning their retirement without advice, hence the introduction of this new advice allowance.
This new advice allowance that is being introduced on 6th April 2017, can be used for regulated advice and will not apply to individuals that have defined benefit such as final salary.
If you use the tax credits or self-assessment helplines, you might be invited to enrol for HMRC’s new recognition security process in the coming months. This is to speed up the security process and if offered the opportunity to enrol, you will be asked to repeat a vocal passphrase up to five times and then you will be passed back to an advisor to conclude the phone call
Customs relationships with EU – Government Unveils its strategy
Government expressed its intentions and aspirations in this paper. It also responded to the concerns raised during post Brexit-poll discussions. In the paper Govenment has provided two options or routes available to the government. First approach is to build upon the existing arrangement by utilizing the processes existing with other countries. Second approach, being unprecented a more challenging approach would involve mirroring the EUs at its arangments with rest of the world.