Pausing pensions could be costly
Analysis (1) has revealed that reducing or stopping pension contributions, even for a relatively short period of time such as a year, can have a significant impact on your final pension pot, with savers potentially being thousands of pounds less well off in retirement. Almost all (93%) of those surveyed said they are feeling the impact of increasing costs and inflation. Whilst 77% expect to have to make cutbacks on spending or saving, an encouragingly low figure of 6% said they would reduce their pension contributions.
Record CGT
HM Revenue and Customs has revealed that a record amount of Capital Gains Tax (CGT) was due in the 2020-2021 tax year. The total amount of CGT liability was £14.3bn, realised on £80bn of gains for 323,000 taxpayers. The total CGT liability increased by 42% from the previous year, while the amount of gains and number of taxpayers increased by 19% and 20% respectively. More people are likely to be impacted by CGT over the coming years after the March 2021 Budget decision to freeze the annual £12,300 CGT allowance until 5 April 2026.
*1,Standard Life, 2022
The value of investments can go down as well as up and you may not get back the full amount you invested.The past is not a guide to future performance and past performance may not necessarily be repeated
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