The government claims this means ordinary investors with smaller portfolios and modest dividend income will see no change in their tax liability. According to its sums, when combined with the increases the government has made to the personal allowance and the introduction of the Personal Savings Allowance, from April 2016 individuals will be able to receive up to £17,000 of income per annum tax-free.
Clearly that is the Governments spin on what could happen but for the majority of people over here the income they get comes from savings, investments or a pension. So here’s the rub, the new rules will cut an additional £2.5billion out of investor’s income through tax.
At the moment basic-rate tax payers are not required to pay tax on dividends.
But under the new rules that will change. From April 2016 all taxpayers will have a new tax-free dividend allowance of £5,000 a year. After this tax is to be charged at new rates that are 7.5 per cent higher than current levels. The overall tax rate will depend on your income tax rate band.
If you are affected in some way by the changes outlined above, or have any questions regarding how to make the most of your money, it is well worth sparing some time to see a Financial Adviser.
This communication is for informational purposes only and is not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice from a professional adviser before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained in this communication is correct, we are not responsible for any errors or omissions.
In recent years Portugal has become a very attractive prospect for anyone looking to move to sunnier climes. A number of initiatives by the Portuguese government have made it easier for non-European citizens to apply for special visas, which allow them to both live and work in the country. The most famous of these is the so-called Golden Visa, which permits people to become resident based on their making a significant investment in the country, purchasing property, or setting up a business. Whatever your reason for wanting to move, and there are many, getting a mortgage in Portugal is going to be high on your agenda.
At the moment, no one can say with complete certainty what will happen in the near future regarding Brexit and pensions.