After weeks of frankly feverish speculation, we can now assess the Budget in terms of what is actually in it.
There has been a big rise in the tax burden with employers bearing the brunt including a rise in Employer’s National Insurance to 15% from next year as Sky reports here.
There has been a heated argument about whether this will be passed on to employees through lower pay amid warnings of job losses or new jobs not offered as the Guardian reports here.
Accounting Web considers the wide ranging impacts across different type of employment.
There has also been a lot of debate about bringing unused pensions under the IHT umbrella and what the consequences might be.
Mortgage Solutions calculates that with stamp duty increasing from 3% to 5% on second homes it could cost landlords an extra £7,000 on an averagely priced property. (Perhaps we'll need to see those numbers tested by reality but it does feel like quite a shock to some.
The move to bring unused pensions within the scope of IHT is another significant move though not until 2017.
Billy Burrows, in Money Marketing, says that the change may drive annuities demand, a point being made by other advisers on social media.
Ed Monk, who is on the Fidelity content team and was a rather good journalist in his day, warns of a risk of a double tax hit. On the platform's website, he writes: “For example, where IHT is due, £100 of pension money would be subject to 40% IHT, leaving £60. If death occurs after age 75, this money would then be subject to the beneficiary’s rate of Income Tax. In the worst case this would be 45%, resulting in just £33 being received by the beneficiary - an effective tax rate of 67%.”
The state pension will rise to 95% of the personal allowance with the latest triple lock upgrade, as Corporate Adviser reports. Controversy is obviously on the horizon as if we haven’t had enough already.
The Office for Budget Responsibility noted that tax rises and rises in borrowing with revised methods of calculating public sector borrowing means that the extra annual Government spending is up to £70bn.
Much has been made of the adverse market reaction.
The pound saw the largest falls for 18 months and 10-year gilts did not have a very good Budget Day. It continued the next day as Sky reports here, though not perhaps to the extent of anyone declaring it a crisis.
Again to Corporate Adviser, which really has some very good Budget coverage, it asks an important question about the gilt yield rises hearing DB schemes play down fears of further liquidity squeeze.
Farmers are up in arms. The Country Land and Business Association (CLA), which represents thousands of farmers and landowners, said Labour's decision was 'nothing short of betrayal'.
It estimates that capping agricultural property relief at £1m could impact 70,000 UK farms, in turn 'damaging family businesses and destabilising food security' as Farming UK reports.
Worth noting some online debate regarding people who accessed tax free cash. Can they undo their plans as some platforms have a cooling off period?
In other news, Seven Investment Management (7IM) has acquired Rockhold Asset Management to expand its investment proposition, taking 7IM’s assets under management to around £27bn.
Rockhold Asset Management was launched in 2022 by the ASHL Group and now manages around £2bn of clients’ assets, as Money Marketing reports.
The FCA has issued a warning notice against hedge fund manager Crispin Odey for stymieing an internal inquiry into his behaviour.
