Category Archives: Investment

Fyfe Financial Budget Summary 2016

Budget 2016We have pleasure in providing our summary of the key announcements in the  Chancellor’s 2016 Spring Budget statement. We hope you find it useful and interesting.

This was the third Budget within a year, but George Osborne still managed to produce a few surprise measures among the inevitable re-announcements. The most significant measures included:

• The launch of a new Lifetime ISA from April 2017 for adults under the age of 40, with a maximum contribution of £4,000 a year and a 25% government bonus on savings.

• A cut in the main rates of capital gains tax from 2016/17 to 20% for higher and additional rate taxpayers and 10% for other taxpayers, although the existing rates will continue to apply to gains on residential property and carried interests.

• An increase in the income tax personal allowance for 2017/18 to £11,500 and the higher rate threshold to £45,000.

• Two new £1,000 tax allowances for property income and trading income, starting in April 2017.

• A restructuring of stamp duty land tax (SDLT) on commercial properties.

• A major revamp of business rates, permanently doubling the Small Business Rate Relief.

• The abolition of Class 2 National Insurance contributions from 6 April 2018.


Please download the full Fyfe Financial Budget Summary for 2016.


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The Taxation of Commission Rebates does not Treat Customers Fairly

This isn’t the first time I’ve got myself into a flap about an announcement concerning the financial services industry. It usually results in a forthright discussion with a colleague and then back to business as usual. However, since reading about HMRC’s intention to tax trail commission rebates, I’ve been unable to get it out of my system.

There’s something inherently wrong about taxing someone on the return of their own money, particularly when investors have been shoe-horned down this route with the banning of trail commission on new investments and changes to existing ones. Don’t get me wrong, the implementation of Customer Agreed Remuneration is an improvement on automatic commission payments and the move towards clean charging is a positive step. However, penalising clients because the fund management industry has not yet caught up with the new regulatory framework is surely against the principles of the Treating Customers Fairly initiative. It’s not their fault that many funds do not have clean share classes nor that those that do are often more expensive.

I understand that HMRC are legally obliged to collect any tax that is due but surely there could be some leeway. After all they have already stated that they will not seek to collect tax due for previous years. Could such a concession not be extended at least until the proposed rebate ban has been enforced towards the end of the year? This would give the industry both the time and motivation to sort out the move to clean charging once and for all.

Let’s hope common sense prevails.

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