Your last chance to use your 2015/16 tax allowances is getting closer. The deadline to act is Tuesday 5 April.
“The end of the tax year is a critical deadline for millions of savers because when the clock strikes midnight on 5 April, this year’s Isa allowance disappears forever, and SIPP investors also lose the chance to offset this year’s tax bill by making a pension contribution,” warned Danny Cox of Hargreaves Lansdown.
Want to avoid getting a fixed penalty notice for a motoring offence? Avoid speeding, belt up and pay more attention! Speeding is the most common offence drivers are charged with but more than two million motorists were fined for not wearing a seat belt in the last decade.
That was out of a total 28 million fixed penalty notices in the last 10 years, according to analysis by Direct Line, more than half of which were for speeding.
Meanwhile more than two million drivers were issued with fines for neglect of traffic signs and directions, or pedestrian rights, including failing to give way, running a red light or driving elsewhere than on the road.
Interestingly, more than a million people were fined for using a mobile phone while driving.
We collectively owe £192bn or £6,000 each, reckons Moneysupermarket. Two-thirds of UK adults admit currently having some form of unsecured borrowing, such as personal loan, overdraft or credit card.
But switching to cheaper deals could save money. For instance, moving an average credit card balance of £2,210 to a 0 per cent balance transfer card with a typical fee of 2.99 per cent could save £278 a year, the site says.
Halifax has increased its Savers Prize Pot for June to £3m, meaning more than 1,500 prizes, including three awards of £500,000.
To be in with a chance of winning you need a savings balance of £5,000 or more in qualifying Halifax or Bank of Scotland savings accounts for a complete month before the draw and you need to register for entry by 31 May.
The retirement industry fears the surprise new lifetime Isa announced in the Budget signals the death knell for pensions. “The new lifetime Isa looks like a backdoor policy designed to attract younger people towards Isas over pensions,” said Rebecca O’Keeffe, head of investment at Interactive Investor.
Lynda Whitney, partner at Aon Hewitt, added: “The Chancellor’s announcements on pension issues look like unfinished business. The new lifetime Isa could well be the Trojan horse that kills off pensions at a later stage.”
Michelle McGrade, chief investment officer at TD Direct Investing, said: “Mr Osborne has today had a first stab at pension simplification. Rather than tinkering with the old regime, he is dreaming up a new one.”
Part of the problem is because “pensions remain a tainted brand, shrouded in complexity and mistrust”, according to Holly Mackay, managing director of website Boring Money. She predicted that: “UK pensions companies will be huddled in the boardroom today, feeling beaten up and digesting what this means for the future of the pension.”
But it’s been clear for a number of years that the Government was laying the ground for an effective abolition of pension plans in their current form, with Isas to be the replacement, said Brian Dennehy of FundExpert. “Over-40 pension savers should not expect the current tax attractions of pension plans to persist for more than another year, perhaps two,” he warned.
* * *
Planning an Easter getaway? It may prove to be more expensive than you expected. Concerns over Britain’s possible exit from the EU have hit the pound hard and it has fallen by 2 per cent against the Euro in the last two days.
The pound has fallen by more 6 per cent since January and 11 per cent since last summer - meaning you get nearly £120 less spending money in Europe for every £1,000 exchanged, warns FairFX.
* * *
Sharing the cash around ensures a contented population. Or, as an academic has it: “Re-distribution of wealth has an important role to play in national happiness.”
That’s the view of Dr Selin Kesebir, assistant professor of organisational behaviour at London Business School. “Countries with growing income inequality often fail to increase average happiness, even if they succeed in boosting GDP,” she said. “Happier people are more productive, so this really matters.”
* * *
Central heating and double glazing are the top must-have property features homebuyers want, reckons GoCompare. It says warmth and energy efficiency are key priorities thanks to the British climate and rising energy prices.
There are millions of potential winners from today’s Budget announcement. You simply need to be a taxpayer to – at least on the face of it – be better off as a result of George Osborne’s further tinkering with the tax system.
In short, he has raised the tax thresholds, which means you can earn more money that you pay no tax on. For middle-income earners, Mr Osborne has raised the 40 per cent threshold for the first time in years.
However, the changes won’t come into effect until April 2017, which means you’ll have to wait another year to benefit from the rise in the basic-rate tax threshold to £11,500 and the rise to £45,000 before you have to pay 40 per cent tax. HM Revenue & Customs reckons the changes will give an average tax saving of £56 to a basic-rate taxpayer and £233 saving to a higher-rate taxpayer from April 2017.
Other handouts that could boost your income include a halving in the Severn Bridge toll, which is great news if you are a regular visitor to Wales.
But the sweet-toothed and smokers have been hit with a 2 per cent above inflation rise in tobacco duty from 6pm last night and a new sugar tax on soft drinks from 2018.
Meanwhile, most households will be hit by the extra 0.5 per cent added to insurance premium tax. Rough calculations suggest that will add just under a tenner to the average household with car cover and home insurance.
Women born in the 1950s hit by the rising state pension age could still retire before they are 66 in return for taking a “slightly” lower pension, a committee of MPs has suggested.
Campaigners from Women Against State Pension Inequality (WASPI) have been urging the Government to give transitional help to the estimated 500,000 women who have seen their state pension age jump from 60 to 66 with little notice.
The Commons Work and Pensions Committee said affected women should be allowed to take their state pension sooner than scheduled in return for lower weekly payments. It said the measure would mean no overall cost to the public purse.
From today British Gas customers will start to benefit from a 5.1 per cent price cut on their gas bill. But MoneySaving Expert Martin Lewis warns “you’re still being ripped off”.
Even after the price cut, if you’re on a standard tariff, you’ll still be paying £300 more than the cheapest deal. “Don’t think ‘hurrah prices have dropped’ – do a cheap energy comparison and ditch and switch now,” advises Mr Lewis.
Three-quarters of mortgage deals now offer gimmicks such as cashback or free legal fees, reckons Moneyfacts. But that’s good news as incentives such as free legal fees, free valuation or even cashback can be attractive. “Savvy borrowers can turn the situation to their advantage and minimise up-front costs,” said Charlotte Nelson of Moneyfacts.
The government has confirmed a £1,200 bonus for up to 3.5 million people through its new Help to Save scheme. It will allow anyone in work and in receipt of Universal Credit or Working Tax Credits to save up to £50 a month and get a 50 per cent bonus after two years – worth up to £600.
Account holders will be able to continue saving under the scheme for two more years and get another £600 bonus. Full details will be in tomorrow’s Budget.
But former pensions minister Steve Webb warned of potential mis-selling. “Low-paid workers with spare cash should think carefully before assuming that the scheme is the best deal for their money,” said Mr Webb of Royal London. “It would be unfortunate if the initiative turned into a new mis-selling scandal, with workers discovering they could have got a better deal from a pension.”
* * *
The number of telematics black box insurance policies that reward motorists for careful driving has climbed by 40 per cent in the last year, according to the British Insurance Brokers’ Association.
It says there are now nearly 455,000 live policies. Some young drivers can save £1,000 a year by using telematics cover, which monitors how well you drive.
The Chancellor could slap another three per cent increase on the rate of insurance premium tax in Wednesday’s Budget.
That would increase the rate to 12.5 per cent – hitting everyone who buys motor, home, breakdown or travel cover. The AA points out that after November’s hike in the tax from six per cent to 9.5 per cent, another 3 per cent rise will mean the tax will have more than doubled in six months.
An IPT rise to 12.5 per cent would mean £37 added to the average car insurance premium and more than £80 for young drivers.
“Drivers are not wallets on wheels but appear to be treated that way by the Treasury,” said AA president Edmund King. “Car insurance is not a luxury but a legal necessity so should not be taxed like a luxury.”
Santander is increasing the rate paid on its Help to Buy ISA to 4 per cent from today and says those who have already taken out its existing deals paying 1.5 per cent can switch to the new offer. The rate matches that paid by Halifax, which has paid 4 per cent on its Help to Buy Isa since launch in December.
First-time buyers can start one of the tax-free savings schemes with £1,000 and then save £200 a month towards a home deposit and eventually earn a government bonus of 25 per cent of the amount they save, up to a maximum £3,000.
Almost a third of us still use a jar or tin to save, reckons Sun Life. But it’s not older folk stuffing their money in the biscuit tin; young adults are actually much more likely to save in this way.
Almost half of 18-24 year-olds save in a jar compared to less than a quarter of over 55s. That’s probably because they have the smallest amount of savings.