No Changes to UK Pensions Announced in Autumn Budget
Dubbed the quietest budget for UK pensions in many years, to the relief of many in the pensions industry, the UK Chancellor announced no changes to UK pension’s legislation in the Autumn Budget on 22 November 2017.
In the lead-up to the Autumn Statement, commentators had speculated whether the Chancellor would announce a lowering and/or change to the UK pensions allowance (e.g. the amount of money a person can contribute to their UK pension and receive UK tax relief). The allowance was £50,000 until April 2014 and has since been lowered to £40,000. In addition, some speculated that the Chancellor would again lower the UK’s lifetime allowance.
However, rather than pensions, Chancellor Philip Hammond’s key focus was on preparation for Brexit and the UK housing market. Key budget announcements included:
- In 2017 growth remained solid, but slowed slightly at the start of the year. The UK economy is forecast to grow by 1.5% in 2017, a downgrade from the 2% forecast in March 2017. It is then expected to grow at a slightly slower rate in the next three years, before picking up in 2021 and 2022.
- Inflation is forecast to peak at 3% in the final months of 2017 as measured by the Consumer Prices Index. It is then expected to fall towards the UK’s target rate of 2% over the next year.
- An extra £3 billion is needed to prepare for Brexit over the next two years. It will include funding for border preparation, the future immigration system and new trade relationships.
- The UK’s tax-free personal allowance will rise from £11,500 to £11,850 from April 2018. The higher rate threshold will also rise to £46,350.
- Stamp duty land tax on homes under £300,000 has been abolished for first time buyers from 22 November 2017. This will mean that 80% of people buying their first home in the UK will pay no stamp duty. First time buyers of homes worth between £300,000 and £500,000 will not pay stamp duty on the first £300,000.
If you have any questions about the Autumn 2017 budget and how it might affect your UK pension investments, feel free to Contact Us.