How to afford the car of your dreams!

The main talking point of The Chancellor, George Osborne’s budget concerned the scrapping of the requirement for those with defined contribution pensions to buy an annuity. Instead they will receive free advice to enable them to decide what is best for them regarding their pension savings.

This would allow people to take a big chunk of their savings pot to spend early in their retirement. The taxable part of pension pot taken as cash on retirement which currently stands at 55% will in future be charged at the normal income tax rate.

Some economists have expressed concern at the prospect of pensioners squandering their money in early retirement although Steve Webb the pensions minister is relaxed about how they decide to spend their money when they retire, saying “they should be free to buy a Lamborghini with their life savings if they want to”.

Other highlight’s from The Chancellor’s budget include:

The point at which people start paying income tax will increase from £10,000 to £10,500

Threshold for 40p income tax to rise from £41,450 to £41,865 next month and by a further 1% to £42,285 next year

From 1 July, cash and shares Isas will be merged into a single new Isa with annual tax-free savings limit of £15,000

A twelve-sided £1 coin will be introduced in 2017

Sandra Smart

About the author

I believe that recruitment is at the heart of a growing economy and that a different type of recruitment service, with honesty, efficiency and integrity at its heart, can benefit all. Octopus Personnel is the result of hard work, focus and commitment to that vision – to delivering consistently great results for our candidates and clients alike, as well as ensuring the agency is a vibrant, inclusive, inspirational place to work and develop rewarding careers.