5 Key Money Planning Dates 2012

5 Key Money Planning Dates 2012
This year is a year of major changes in the finance industry and many of these changes affect all of us.

Changes will effect those:

• Planning to buy a home
• High earners with large pensions
• If you are contracted out of the Additional State Pension (formerly Contracting out of SERPS)
• Large Employers
• People buying Life Insurance, Sickness Insurance, Medical Insurance and Annuities

21 March - The Budget

Next Month, the Chancellor will come under increasing pressure to stimulate the economy and in particular remove red tape from small business to encourage growth whilst trying to protects services such as the NHS yet with a need to cut spending. Expect the usual deluge of changes that affect us all. Plan early and to help in our next monthly update we are preparing a full "Tax Planning Special".

24 March - Stamp Duty Honeymoon Ends

First time buyers currently have a holiday from paying 1% Stamp Duty of the value of the property when they buy a property between £125,000 and £250,000. This concession currently finishes on 24 March 2012. If you are a first time buyer, make sure you complete before 24th.

6 April - ISA allowances, Capital Gains Tax Allowances etc - use them or lose them.

6 April - High Earners Pensions

The Pension Lifetime Allowance reduces from £1.8m to £1.5m. If your pension fund is bigger than this, you will face an additional tax penalty when you retire.  Whilst this will not affect most of us, for some who have large pension entitements already it may do so.  5th April is the final date for those that do have larger pension funds to apply for Fixed Protection of their LIfetime Allowance before the changes come in. Contact us if you need help avoiding these tax charges.

6 April - Contracting Out Pension Rights

Contracting out of the additional state second pension (S2P), formerly SERPS) into a defined contribution pension stops on this date. In short, if you have a Private Pension or a Company Investment Linked pension, contracted out national insurance rebates will stop and be redirected back into the state coffers. Any 'protected rights' that you have built up inside an investment pension will be automatically converted into normal pension funds i.e. you will have 'ordinary' rights.

We believe this a longer term austerity measure as eventually the additional state second pension will be wiped out and as a token, we will all have our state pension benefit increased to compensate us (as touted by Government at £140pwk) but this new increased State Pension will in fact be far lower than having both a State Pension plus the Additional State Second Pension (S2P) or State Pension and Contracted Out Pension Rights.

1 September - Compulsory Automatic Enrolment in Company Pension Schemes
Employers with 120,000 employees or more must notify staff of being automatically enroled into a pension scheme before this date unless the company already has a qualifying pension scheme. 1 October - Compulsory Automatic Enrolment in Company Pension Schemes begins. Smaller employers will come on board over the coming years.

21 December - Unisex Financial Services

On this date it is illegal to use sex as part of the means for pricing insurance policies. What does mean? 

• Annuity rates for men may lower, annuities for women may improve. Men should consider retiring/buying their annuity before this date.
• Life Insurance rates for men may fall, life insurance rates for women may increase. Women should consider arranging life insurance sooner rather than later.
• Income Protection, Sickness and Medical Insurance rates for men will increase, rates for women may fall.  Men should consider arranging income protection, sickness and medical insurance sooner.
• Motor Insurance rates for men may fall and for women rates may increase.  As these are annually renewable, there is little either sexes can do to avoid any changes as you will have to renew policies within a year anyway.