Farley And Partners

SAVINGS

ISAs

The savings limit for an ISA will increase from £15,000 to £15,240 from 6 April 2015.

At the same time, the Junior ISA and Child Trust Fund subscription limits both increase from £4,000 to £4,080.

TRANSFERS TO SPOUSES AND CIVIL PARTNERS ON DEATH

Legislation will be introduced from 3 December 2014 to allow an additional ISA allowance for spouses and civil partners when an ISA saver dies, equal to the value of that saver’s ISAs.

PENSIONS

Savers will be able to access their deined contribution pension as they wish at retirement from April 2015. This will be subject to their marginal rate of income tax, instead of the current 55% charge for full withdrawal.

Further to the recent announcement regarding people being able to pass on their pension pot to the next generation, the government conirmed that if the individual dies before age 75, the beneiciary will pay no tax on the funds.

If death occurs after the age of 75, the beneiciary will pay their marginal rate of income tax, or 45% if the funds are taken as a lump sum payment. The lump sum payments will also be taxed at the recipient’s marginal rate from April 2016.

From April 2015, beneiciaries of individuals who die under the age of 75 with a joint life or guaranteed annuity will be able to receive any future payments from such policies tax-free.

It will also be possible to allow joint life annuities to be passed on to any beneiciary.

PENSIONS FLEXIBILITY

A reduced annual allowance of £10,000 will be introduced for money purchase contributions for individuals who have lexibly accessed a pension from 6 April 2015.

PENSION CREDIT

The savings credit threshold will rise by 5.1%. As a consequence, the new lat rate state pension will be at least £151.25 a week.

The actual inal amount of this new lat rate pension is to be announced in autumn 2015.

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