It is important to plan ahead for your retirement RK Henshall Financial Services Ltd can advise on and arrange a good pension plan for you. We can review your existing pensions and their suitability as to whether they are competitive and flexible enough to reach your retirement goals.
If you are approaching, or have reached, retirement, we will advise on how best to structure your income to meet your living expenses in the most tax efficient way.
An annuity provides you with a regular income for life in exchange for your pension fund. Annuity types vary – Single Life, Joint Life, Level, Escalating and many more.
You don't have to buy an annuity from your existing pension plan provider.
RK Henshall (Financial Services) Ltd will research whether you can increase your retirement income by using your right to an Open Market Option. We also take into account any health problems you may have and prescribed medication as you may be eligible to receive an enhanced annuity.
Income Drawdown is a different way of providing a retirement income to an annuity. Income Drawdown allows you to delay buying an annuity indefinitely but still receive income directly from your pension fund in the meantime. Income Drawdown gives you the flexibility to vary how much income you take and when you take it. (Funds remain invested and can fluctuate in value).
The tax implications of pension withdrawals will be based on your individual circumstances, tax legislation and regulation, which are subject to change in the future.
A Personal Pension Plan is a savings policy. This type of investment can be very tax efficient, simple to administer and is suitable for a saver looking to achieve fund growth in order to produce an income in retirement. (Currently Pension legislation states that access to personal pension is not available until the member reaches the age of 55)
A Self Invested Personal Pension (SIPP) offers much greater investment choice, freedom and control than a personal pension enabling investment into a wider choice of assets.
Whether you are aiming to achieve long-term capital growth, produce an income, or combine the two, RK Henshall Financial Services Ltd can assess your personal circumstances and objectives and implement practical solutions to reach your goals.
Individual Savings Accounts (ISAs) are a tax-efficient account which can hold either stock market-based investments (such as Unit Trusts or OEICs) or a traditional savings account. As an incentive, any interest earned and any capital gains made within an ISA are tax free. There are two components to an ISA: cash and stocks and shares (sometimes referred to as equities). HM Revenue & Customs rules permit subscriptions into an ISA subject to a maximum value in any one-tax year. For the 2019-20 tax year the annual allowance for ISA investments is £20,000 and the full amount can be invested in a Stocks & Shares ISA or a Cash ISA (or any combination of the two).
An Investment Bond is a single premium policy usually linked to one or a range of investment funds offered by a life assurance company. This type of investment can be very tax efficient and simple to administer.
Investment Bonds are available as an Onshore product or Offshore product and each will have particular merit depending on your financial circumstances and objectives.
A structured product is an investment product which is based on either deposits (Structured Deposit) or derivatives (Structured Investment). Most structured products provide some kind of guarantee function offering investors a degree of protection of the initial capital if the product is held to maturity.
Enterprise Investment Scheme (EIS) provides tax incentives in the form of a variety of income tax and capital gains tax reliefs to investors who invest in smaller, unquoted, trading companies.
Venture Capital Trust (‘VCT’) is a company, broadly similar to an investment trust, which has been approved by HMRC and which subscribes for shares in, or lends money to, small unquoted companies. Under the VCT scheme, VCTs and their investors enjoy certain tax reliefs. (High risk investments and are only suitable for experienced investors)
The value of your investment and pension can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Investing in shares should be regarded as a long-term investment and should fit in with your overall attitude to risk and financial circumstances. Levels and basis of relief from taxation may be subject to change and their value depends on the individual circumstances of the investor.
If your estate is valued over £325,000 then it will be subject to tax at the current rate of 40% (or 36% if you leave at least 10% of your total asset value to a charity). With average house prices in some parts of the UK well in excess of the £325,000 allowance, more and more people’s estate are being taxed.
Main residence nil rate band - This measure introduces an additional nil-rate band when a residence is passed on death to a direct descendant.
This will be:
£150,000 in 2019 to 2020
£175,000 in 2020 to 2021
It will then increase in line with Consumer Prices Index (CPI) from 2021 to 2022 onwards. Any unused nil-rate band will be able to be transferred to a surviving spouse or civil partner.
The additional nil-rate band will also be available when a person downsizes or ceases to own a home on or after 8 July 2015 and assets of an equivalent value, up to the value of the additional nil-rate band, are passed on death to direct descendants.
There will be a tapered withdrawal of the additional nil-rate band for estates with a net value of more than £2 million. This will be at a withdrawal rate of £1 for every £2 over this threshold.
Whilst it can be difficult to escape Inheritance Tax there are some ways of reducing it substantially without giving away control of your property and investments. In some cases it is possible to remove your investments from your estate and the clutches of the tax man but still derive an income from them. It is also possible to insure the potential inheritance that could be due.
Consideration of Inheritance Tax is an important part of tax and estate planning for individuals and their families. Even a simple review of family’s wealth can often identify straight forward ways of avoiding future unexpected tax liabilities. Lifestyle changes such as divorce, redundancy or an inheritance mean that Inheritance Tax strategy should be regularly reviewed.
Levels of and reliefs from taxation, may be subject to change and their value depends on your individual circumstances.
(The Financial Conduct Authority Does not regulate Tax Planning)
Whether you are looking to ensure your family's financial security in the event of your death, or to protect your income should you be unable to work due to long-term illness, disability or unemployment, RK Henshall Financial Services Ltd can help you find the right solution.
A Life Cover policy is designed to pay out a lump sum should the policy holder(s) die within the term of the policy. The lump sum payment can be used as you wish, such as helping towards household bills, replacing an income, clearing debts etc. For an additional cost Life Cover policies can also include Critical Illness cover which will pay out a lump sum should the policy holder(s) be diagnosed with a Critical Illness within the term of the policy. (The cover is generally for a fixed term, selected by you and has no cash in value)
Critical Illness cover pays out a lump sum should the policy holder(s) be diagnosed with a Critical Illness within the term of the policy. The lump sum payment can be used as you wish, such as helping towards household bills or medical costs, replacing an income, or simply allowing you to pursue a less stressful lifestyle while you recover. (A critical illness policy only covers predetermined illnesses as set out in the policy T&Cs and has no cash in value. The number and severity of illness covered varies between insurer)
A family income plan provides the certainty of a regular, tax-free income, for your dependents from the time of the policy holder’s death to the end of the plan term. A family income plan removes the need to worry about complex investment decisions to make the most of a lump sum payout. (The cover is generally for a fixed term selected by you and has no cash in value)
A mortgage is arranged to gradually reduce over the selected term and Mortgage Protection is designed to mirror the reducing mortgage debt. Should the policy holder(s) die within the term of the policy a lump sum will be payable to clear the outstanding mortgage balance. For an additional cost Mortgage Protection policies can also include Critical Illness cover which will pay out a reducing sum assured should either of the policy holders be diagnosed with a Critical Illness. (The cover is generally for a fixed term selected by you and has no cash in value)
Income Protection insures part of your earnings (usually up to a maximum of 60%) against illness or accidental injury. It is designed to enable you to cover your essential outgoings if you become ill or have an accidental injury that prevents you from earning a living. Income Protection policies will pay you a monthly benefit pay until you either return to work, the end of the policy term, or you die. (The cost is dependent upon your occupation, health & is generally written until your stated retirement age)
A Whole of Life plan is a form of life assurance that pays out a sum assured lump sum upon your death. The policy is designed to provide only financial protection against death. This can be used for paying any Inheritance Tax due on the estate, providing financial support to loved ones or indeed for funeral costs.
Private Health Insurance pays for healthcare treatment in private medical facilities. The scope of the cover varies considerably depending on the options you select.
Most plans will cover inpatient and day patient treatment in full which means that you would be covered for treatment, testing and consultations where a hospital bed is required either overnight or just for the day.
To cover initial consultations and diagnostic testing where a hospital bed is not required a level of outpatient cover will need to be selected. This is recommended to avoid NHS outpatient waiting lists.
Lifetime mortgages carry risks, and are not right for everyone. It’s important to obtain advice in this complex area of financial planning. Where we can, we involve other family members to ensure that there are no other suitable solutions as this type of facility is often a last resort.
Lifetime mortgage is a mortgage which allows you to borrow money secured against your home to release the equity (cash) tied up in it – without having to move and without having to pay a monthly payment to the lender. The interest charged is added to your initial mortgage account and you are free to use the money as you choose. People choose this route as they don’t want to move out of their home and use the cash released for many reasons such as home improvements, subsidising pension income and paying off debts. It will reduce the amount of inheritance you can leave. Releasing equity can affect your tax position and eligibility for welfare benefits. This is a lifetime mortgage. To understand the features and risks, ask for a personalised illustration.
Allows you to borrow against the value of your home while retaining ownership. Interest is added to the mortgage and repaid when your home is sold. Flexible lifetime mortgages allow you to access funds as required and you only pay interest on what you actually borrow.