How the October Budget could impact your personal finances

In the run-up to a Budget there’s always plenty of speculation about potential changes to the tax system. But ahead of the first Budget from a new government on 30 October, rumours have been running wild after Chancellor Rachel Reeves revealed a £22 billion black hole in the public finances. Joining Kyle to discuss the taxes Labour may target and how your personal finances could be impacted is friend of the pod Craig Rickman, interactive investor’s personal finance editor.
On The Money is an interactive investor (ii) podcast. For more investment news and ideas, visit www.ii.co.uk/stock-market-news ( gate.sc/?url=h... ).
Kyle Caldwell is Collectives Editor at interactive investor.
Important information:
This material is intended for educational purposes only and is not investment research or a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy. The value of your investments can rise as well as fall, and you could get back less than you invested. Past performance is not a guide to future performance. The investments referred to may not be suitable for all investors, and if in doubt, you should seek advice from a qualified investment adviser. SIPPs are aimed at people happy to make their own investment decisions. Investment value can go up or down and you could get back less than you invest. You can normally only access the money from age 55 (57 from 2028). We recommend seeking advice from a suitably qualified financial adviser before making any decisions. Pension and tax rules depend on your circumstances and may change in future. If you are in any doubt about the suitability of a Stocks & Shares ISA, you should seek independent financial advice. The tax treatment of this product depends on your individual circumstances and may change in future. If you are uncertain about the tax treatment of these products, you should contact HMRC or seek independent tax advice. Interactive Investor Services Limited is authorised and regulated by the Financial Conduct Authority.
On The Money
Episode 99
September 12, 2024
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[@Mike-lb1hx]

Making pensions part of the estate seems unfair when death in service benefits are not as they both are methods of caring for dependents

[@leobrown6875]

If the government made me pay my staff more pension, then I would just close up .what they need to do is stop given over the top pay rises .make all public workers pay their own pension and stop spending billions on refugees and foreign aid .also start sorting out the grey market plumber builders sparky etc earn very good money but do pay much tax

[@andy_4264]

Will very much depend on their ongoing definition of “working people” public sector very much fits that definition at present. Given looming pension poverty in UK unlikely to touch public sector schemes.

[@Benzknees]

Yes, public sector employers pay 23-28% contribution into their employees' pensions, vs 3-10% in the private sector. And some retire a lot earlier. All ultimately paid for by the taxpayer.

[@leobrown6875]

If the clowns in charge play too much with pensions, people will go underground with their wealth .we need a reason to save .

[@Benzknees]

The worst thing is the uncertainty from them being turned into a political football & tax cash cow. Coming after Gordon Brown's ACT tax raid, that near destroyed DB pensions in the private sector, it's almost as if the govt are determined to get everyone to become dependent on the State.

[@Mike-lb1hx]

Restricting pensions tax relief won't work, it is easily avoided by making the contributions via salary sacrifice which would in turn require a benefit in kind tax on employer contributions which is where the fun begins. A firefighter on 45k who has 3 kids and a degree will have a marginal deduction rate in excess of 90%. Its true of other public sector workers and I can see it being over 100% if applied fairly (that is no special rules)

[@Mike-lb1hx]

Currently it tax at 20% rising to 40%, NI rate 2% to 8%, Child benefit withdrawal 15.5%, student loan 9%, & pension contributions 12.9% less tax. Firefighters employer pension is valued at 36.7% of salary so increases PAYE by 7.3%, child benefit removal a further 5.7%, student loan a further 3.3% and pension contributions restricted to Basic rate relief an extra 2.6% totalling 99.1% deductions A pension rate of 38.7% would lead to 100% marginal rate deductions unless you can spot an error

[@aekula5079]

9:57 Nobody complains that there are too many car options to choose from, so why should multiple isa options be a problem?

[@mattgoodwin-king2228]

True. I don't think the 4 ISA types are at all complicated. I would have welcomed adding the British ISA too.

[@davideyres955]

@@mattgoodwin-king2228typical Labour stupidity. The ISA providers don’t want to move things away from foreign markets because they all make more from FX fees than they do on UK trades. If you don’t understand it then don’t use it. Personally I’d like to see an extra 5k on ISA allowances, but that’s not going to happen. The stupid thing is that it is simple to invest now. It’s not expensive either with companies like freetrade and trading 212. Spend 10 minutes on KZbin and crack on.

[@mattgoodwin-king2228]

@@davideyres955 Absolutely David. And yes I am maxed out and was looking forward to an extra 5K allowance.

[@Benzknees]

Because those in authority assume everyone else are helpless morons!