Complex tax-efficient investments such as Enterprise Investment Schemes (EIS) and Venture Capital Trusts (VCT) are a consideration for those who may be able to tolerate a high level of investment risk.

EIS and VCT are investment vehicles which encourage investment in small, unquoted trading companies in their early stages, who are typically trying to raise capital. These initiatives benefit the economy by promoting innovation amongst the small higher-risk business community, which in turn drives productivity, creates jobs and boosts economic growth.

Since their launch in the 1990s, they have become popular features on the investment landscape. Both schemes still provide an attractive proposition for experienced investors today, looking for the chance to invest in new businesses with the added benefit of portfolio diversification.

High volume of inflows to the small business sector

The schemes have proved successful in terms of generating cash for the small business sector. Data shows since their launch in 1994, over £20bn of funds have been raised through the EIS scheme, with 29,770 individual companies benefiting from investment. VCT have had a similarly positive impact, raising £8.4bn of funds since their creation in 1995.

How do they work and how much can I invest? In the case of the EIS, investors typically purchase shares directly in firms. VCT are listed companies that allow investors to spread the investment risk over a number of companies by subscribing for shares in the VCT itself, a similar approach to investment trusts.

Currently both offer 30% tax relief and tax-free capital growth, provided an EIS investment is held for at least three years and a VCT for five years. The maximum amount anyone can invest in an EIS is £1m per tax year, or £2m, as long as at least £1m of this is invested in ‘knowledge intensive’ companies. Individuals can invest up to £200,000 each fiscal year in new shares issued by a VCT.

Potential risks
While there are plenty of benefits associated with these schemes, they are only suitable for investors who are comfortable holding high-risk investments. This enhanced risk element stems from the fact that EIS and VCT invest in small, fledgling enterprises.

Although some of these companies will flourish and deliver strong returns, some will fail. As a result, these schemes have a high-risk profile, which is something any prospective investor needs to carefully consider. EIS and VCT investments are only suitable for a relatively small proportion of an investor’s overall portfolio. As these schemes invest in small companies with shares that are illiquid, they can be hard to sell.

As long as the risks are fully understood, these schemes are worth considering for investors seeking a long-term investment that maximises tax-efficiency and provides portfolio diversification.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes, which cannot be foreseen.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Spotlight on eis and vct

Key takeaways

  • EISs and VCTs are investment vehicles which encourage investment in small, unquoted trading companies
  • Both schemes provide an attractive proposition for experienced investors looking for the chance to invest in new businesses with the added benefit of generous tax breaks and valuable portfolio diversification
  • The schemes offer 30% tax relief and tax-free capital growth, provided an EIS investment is held for at least three years and a VCT for five years
  • The maximum amount to invest in an EIS is £1m per tax year, or £2m, as long as at least £1m of this is invested in ‘knowledge-intensive’ companies, while individuals can invest up to £200,000 each fiscal year in new shares issued by a VCT
  • A benefit of EISs is their eligibility for Business Relief, meaning that if the investment is held for two years, and until death, the value of the assets will not be liable for IHT
  • Although some of these companies will flourish and deliver strong returns, many will fail
  • Suitable for investors who are comfortable holding high-risk investments
  • EIS and VCT investments are only suitable for a relatively small proportion of an investor’s overall portfolio
  • Provided the risks are fully understood, these schemes are worth considering for any wealthy investor seeking a long-term investment that maximises tax-efficiency and provides portfolio diversification.

US Election 2020

The office of US President carries huge influence all over the world and, as a result, the way the American electorate votes on 3 November will undoubtedly impact financial markets across the globe. US elections are always occasions of great political theatre but the 2020 campaign, played out with the backdrop of a global pandemic, has very much raised the bar. However, the outcome will determine the future path of the world’s largest economy for the next four years and that prospect inevitably leads to considerable speculation about what victory for each of the principal candidates might mean for the markets.

‘America First’
Four years ago, Donald J. Trump was elected the 45th US President riding on one simple slogan: ‘Make America Great Again’. His 2020 pitch is very much a continuation of his ‘America First’ principles, with Trump still vowing to bring jobs and manufacturing back to the US, protect US trade interests and continue his promotion of a hard-line immigration stance, including expansion of a US-Mexico border wall.

‘Build Back Better’
When Democratic Party nominee Joe Biden formally announced his candidacy, he stated two things that he stood for: workers who ‘built this country’ and values that can bridge its divisions. His economic proposals, dubbed a ‘Build Back Better’ plan, would see a large rise in infrastructure spending; while restoring healthcare rights, environmental protections and international alliances are among Biden’s other top priorities.

Who will triumph?
Statistically speaking, the weight of history is strongly in favour of the incumbent when it comes to US presidential elections – since 1932, almost three-quarters of sitting presidents have been re-elected. However, opinion polls have consistently put Biden ahead of Trump in most key battleground states and no other incumbent has secured re-election with an approval rating as low as that endured by the current President.

The COVID factor
But these are clearly not normal times and this year’s election is racked with much greater uncertainty than usual due to coronavirus. There is certainly clear blue water in terms of the candidates’ views on COVID-19 and the response each feels government should adopt in tackling the pandemic. In addition, it remains to be seen what impact, if any, the President actually contracting the virus and his subsequent recovery, will have on people’s ultimate voting intentions. As a result, despite the evidence from opinion polls, most pundits appear reluctant to call the election just yet.

Control of Congress
While most media attention has focused on the presidential race, US voters will also be electing new members of Congress and the ability of either candidate to enact legislation will ultimately be contingent on which party assumes control of the House of Representatives and the Senate. At the moment, Democrats control the House and Republicans the Senate and if this political gridlock persists, it would act as a restraint on any radical policy proposals put forward by either candidate. In contrast, a clean sweep for either the Republicans or Democrats would alter the political landscape significantly. With just a third of Senate seats up for grabs, the Democrats may have the tougher battle but as with the presidential battle, any outcome remains plausible.

Market impact
While the US population’s choice of Trump or Biden will inevitably affect future market direction, what that impact will be is perhaps less clear-cut and opinion is certainly divided amongst analysts. Some cite strong market growth in 2016 as evidence that a Trump victory would be best for the economy, while others suggest a Biden presidency would lead to more economic stimulus and thereby boost the markets, certainly in the short term.

Democrats versus Republicans
A number of market commentators have also pointed to history as a potential guide to the future. Interestingly, while ‘conventional’ wisdom may suggest the US stock market should perform better under a Republican president’s ‘business-friendly’ policies, the hard facts don’t support this crude partisan caricature. Indeed, in the period since the Second World War, the evidence clearly shows that stock market indices have produced better returns under Democratic presidents than their Republican counterparts.

Better the devil you know?
Some analysts have also shown that markets tend to perform better when the same President, or a candidate from the same party, retains control of the White House. Although there is no evidence to support whether such a relationship is causal or correlational, this could imply that a ‘changing of the guard’ may dampen market prospects.

Investment cycles
Other commentators point to market cycles and their alignment with the four-year election term when assessing likely post-election economic and stock market performance. Analysis by US economist Yale Hirsch, for instance, suggests that, in the first year of any administration, economic and stock market growth is relatively weak and remains below average in year two. Year three typically produces the best results, while market performance in year four also tends to be higher than the earlier years.

The way ahead
Speculation regarding the election’s potential market impact will inevitably continue as the presidential campaign reaches a crescendo in the coming week. However, whoever ultimately takes up residency in the White House, it’s important to remember that the basic rules of successful investment won’t change. The key to investing centres on creating a balanced portfolio that is capable of adapting to changing market conditions and it’s vital not to let short-term politically-charged events alter such an approach. Adopting a consistent investment strategy and not being blown off course by short-term scenarios is most likely to stand investors in good stead over the long term.

Recent research shows 1 in 10 UK adults with a pension (and not yet retired) have reduced or stopped pension contributions because of Covid-19.

  • 1 in 10 UK adults have reduced or stopped pension contributions
  • 1 in 4 workers are worried about paying for every day essentials
  • 1 in 5 workers are worried about keeping up with mortgage or rent payments

The economic fallout resulted in a drop in income for many people meaning them having to decide between their short-term financial needs and long-term savings. The research revealed that almost a quarter of workers (24%) are worried about paying for essentials such as food or energy and a fifth (20%) are concerned about paying mortgage or rent.

Greater impact for those already struggling to save
Research has shown that the groups most affected financially by COVID-19 are those groups who may already be struggling to save for retirement: self-employed, younger workers (18—24 – year olds), women and part-time workers.

2 in 5 self-employed workers (43%) have seen their income drop and as a result almost one in five have needed to pause or reduce their pension contributions. This compounds an already existing problem with the self-employed being unable to save adequately for retirement – figures from 2019 show that 41% of the self-employed workforce were not saving anything for retirement.

The nation’s youngest workers are also likely to reduce their pension savings and of this age group, 7% were found to have moved their pension into lower-risk funds, despite being years away from retiring.

Another group already struggling to save are women, who are generally more likely to be in part-time employment or lower-paid jobs. Part-time workers also tend to be less well prepared for retirement and have been harder hit through job losses and furloughing than full-time workers, resulting in them being more likely to change their long-term savings habits than full-time workers (15% versus 6%).

Here to help
If you are considering reducing or stopping your pension contributions, contact us for help in reviewing your options. If you have already taken this step, it is important to review your retirement savings as soon as your situation improves. We are here to help and give you sound financial advice tailored to your individual needs.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

COVID 19 affects retirement plans


  • One in 10 UK adults, with a pension and not yet retired, have reduced or stopped pension contributions because of the pandemic
  • Savers are having to decide between their short-term financial needs and long-term savings
  • Almost a quarter of workers (24%) are worried about paying for essentials such as food and energy and a fifth (20%) are concerned about paying their mortgage or rent
  • Those groups already struggling to save for retirement including the self-employed, younger workers (18 to 24-year-olds), women and part-time workers have been found to be most affected financially
  • Two in five self-employed workers (43%) have seen their income drop, almost three times the proportion of employees (16%)
  • The self-employed are unable to be included in auto enrolment
  • 18 to 24-year-olds are likely to reduce pensions savings and 7% have moved into lower-risk funds
  • Women and part-time workers have also seen a greater impact on their ability to save
  • Contact us to review your options if you are thinking of changing your pension in any way
  • If you have already done so, as soon as your situation improves, we can help you review your retirement planning.

If you are nearing retirement, you may have been particularly worried about the impact of recent market volatility on your pension assets and perhaps you are reassessing your retirement plans. There are several things to consider if you are planning to retire, which will depend very much on your own circumstances.

Since pensions freedoms were introduced in 2015, there are many more options available to retirees. Sudden retirements used to be the norm. People would stop work completely one day and be fully retired the next, perhaps receiving a regular income from an annuity. It is now possible to take a more gradual journey into retirement – making use of this flexibility in how you draw funds could be sensible in times of uncertainty.

Consider your timescales
If your planned retirement is 5 to 10 years away, there is a reasonable time for your savings to recover from the recent market volatility, but you should still take action:

  • Review your retirement age.
  • Consider increasing your pension contributions.
  • Talk to us about your attitude to risk and appropriate fund switches.

If you have less than five years to retirement, your pension pot may not have been exposed to market volatility as much as you think. You may have benefited from a lifestyle option on your pension which is designed to ‘lock in’ investment growth as you approach retirement, by switching funds to less risky assets. This option is not suitable for everyone, particularly if you intend to keep your pension pot invested and use income drawdown to give you an income in retirement.

If you are retiring this year and your pension pot has taken a hit, you could consider delaying retirement until markets recover, but this may not be an option for everyone.

Advice is key
One of the biggest risks in uncertain times is to act in haste and make rash decisions.

Getting financial advice is crucial in making the right decision. We can help you consider all your options, including reviewing whether any other assets could be used to provide an income, so that your pension stays untouched.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.


  • If you are nearing retirement you may be worried about recent market volatility on your pension assets
  • Advice will depend on your own circumstances
  • Pensions freedoms have introduced more options, including a gradual step into retirement
  • Timescales are important but options should be reviewed at each stage
  • If retirement is 5 to 10 years away – review your pension ages, funds and consider increasing contributions
  • If retirement is less than five years away – you may be locked into a lifestyle approach
  • Advice is crucial if your only option is to retire this year and your pension pot has taken a hit
  • Don’t act in haste – talk to us for advice.

Estate planning encompasses not only preparing your finances to ensure your assets are protected for your loved ones once you are gone, but it’s also about ensuring you have enough money to live on.

It starts with obtaining a comprehensive view of your assets. Assessing the value of your estate and ensuring the right documentation is in place is a first port of call (such as Wills, Lasting Powers of Attorney (LPA), and the formation of any relevant Trusts).

Valuing your estate
In order to establish the value of your estate, first calculate the total worth of all your assets, including your home, any other property, money and savings, shares and investments, business equity, cars, jewellery and other personal possessions. Determine the value of

non-monetary assets, by applying a realistic market value. Any gifts which incur Inheritance Tax (IHT) should be added to the value of assets. Then deduct debts and liabilities from this amount to establish the total value of the estate.

Deductions include any outstanding bills, mortgage debt, loans, credit cards, overdrafts, and funeral expenses.

Wills*, Trusts and LPA
Putting together a clear plan, that details your wishes regarding how you’d like your estate to be managed upon your death, will ensure when the person looking after your estate applies for probate they will know what your wishes were. A vital part of successful estate planning is ensuring you have a valid Will in place. Trusts are also a useful way of managing money or other assets on behalf of beneficiaries. There are various types of Trusts which provide an alternative to direct inheritance or transfer of certain parts of an estate, giving you control over who receives what and when. There are 2 types of LPA, ‘health and welfare’ and ‘property and financial affairs’ which are worth establishing at an early stage.

Estate planning can also help you reduce the amount of IHT payable. With expert planning, you can legitimately reduce the amount of IHT payable and pass on assets to your family as intended. For individuals, the current IHT nil-rate threshold is £325,000, and £650,000 for a married couple or civil partners. Any unused portion of the nil-rate band can be passed to a surviving spouse or civil partner on death. Beyond these thresholds, IHT is usually payable at a rate of 40%.

Since April 2017, there has also been a main residence nil-rate band, which applies if you want to pass your main residence to a direct descendant (e.g. child or grandchild). For the 2020-21 tax year, this allowance is £175,000. Added to the existing threshold of £325,000 this could potentially give rise to an overall IHT allowance of £500,000 for individuals, or £1m for those who are married or in civil partnerships. It is important to note larger estates will find residence relief is tapered, reducing by £1 for every £2 by which the net estate’s value exceeds £2m.

There is another simple way of passing money to the next generation which allows for gifts to be made from surplus income. Conditions apply, and advice would be needed to ensure the gifts are made in the right way. We can talk you through the options and help you to find the most appropriate choice.

We can help
We can give you advice to ensure your money ends up with the people you want, for the reasons you choose. We can show you how much money you will need, help you to pass on assets in the most effective way, and work with you to reduce or manage an Inheritance Tax bill.

*Will writing and LPAs are not a part of the Openwork offering. Openwork Limited accepts no responsibility of this aspect of our business. These products are not regulated by the Financial Conduct Authority.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

Key Takeaways

  • Estate planning involves protecting assets for your loved ones and ensuring you have enough money to live on
  • To value your estate, calculate the value of all assets, then deduct debts and liabilities
  • A vital part of successful estate planning is ensuring that you have a valid Will in place.
  • Trusts are a useful way of managing money or other assets on behalf of beneficiaries.
  • There are 2 types of LPA, ‘health and welfare’ and ‘property and financial affairs’
  • Estate planning can help you reduce the amount of IHT payable
  • For individuals, the current IHT nil-rate threshold is £325,000 and £650,000 for a married couple or civil partners
  • There is a main residence nil-rate band (currently £175,000), which applies if you want to pass your main residence to a direct descendant
  • For larger estates residence relief is tapered, reducing by £1 for every £2 by which the net estate’s value exceeds £2m
  • A simple way of passing money to the next generation is gifts made from surplus income
  • We can advise you to ensure your money ends up with the people you want in the most effective way and work with you to reduce or manage an Inheritance Tax bill.

Another great insight to the world of financial markets is now available from OMNIS.



Please click here to go to the in-depth article

A fantastic insight to the world of financial markets is now available from OMNIS.



Please click here to go to the in-depth article


A letter sent out to my clients recently, offering some perspective on the recent turbulence in financial markets. It’s the time in the market that counts, not ‘timing’ the market. With a long term view, short-term gyrations are uncomfortable, but should not detract you from the plan. If you’d invested £1 in UK equities in 1925, it would be worth £9,100.00 today. That £1 investment will have been through world war 2, high inflation, dot com crash, 2008 financial crisis, referendums, plus many more events that cause a seismic shock to the markets.

It would be wrong to suggest that the news from the financial markets is not uncomfortable and concerning. The media has reported daily and we can all see what is happening and the uncertainty created.

At periods like this it is sometimes healthy to do what the standard investment disclaimer tells you never to do – and to look at past performance. History tells us of previous times of disruption and uncertainty on financial markets and, within our own experiences, the recession of 2008 is a relatively recent memory. On each occasion the financial market recovered. The chart below goes back to 1926 and provides helpful context. Financial markets rise and fall – it is the actions of investors and their investment professionals that determines the long-term impact on individual outcomes.

Already we have seen encouraging shifts from those countries which first experienced COVID19 and are starting to emerge from the peak spread of the virus. While we do not expect a smooth or fast return to a more normal market environment, we do expect that a return will happen.

It is the view of our investment experts that the current period of intense disruption will pass. Moreover, if the authorities succeed in containing the spread of the virus, and if increases in bankruptcies and unemployment are limited, our experts believe the stimulus being put in place by central banks and governments could fuel an exceptionally strong economic recovery in the second half of the year. In 6 months’, time we will hopefully have entered a new phase of market stability with every possibility of new investment value and opportunity. Based on our experience it is best to stay in the market, and not incur the cost of missing on active periods of market recovery. This can have a negative effect your long-term returns.

Our Investment Approach

While we are in the current environment our principles of investment management hold firm.

Understand attitude to risk: As your adviser I have worked closely with you to make sure that your portfolio is closely matched to your own view of risk and comfort with loss. The current markets will be giving you pause for thought but I trust that we have matched your investment position to your individual situation. If you are finding that your attitude to risk is changing let’s talk and make the appropriate changes at the right time.

Invest for the long term: Our position, that value is driven by time in the market rather than a moment in time, is unchanging. Now is admittedly, a moment in time of extreme disruption but we hold our position. Economies and financial markets will steady and recover, and a longer-term approach to investing delivers better returns over time

Diversification is vital: Our investment principles are underpinned by a structured and disciplined approach to diversification. Your Omnis portfolio is designed to ensure diversification of investment, asset class, fund manager and fund without any effort on your behalf.

A rigorous and focused Governance process:  We have built a robust governance process. Every aspect of the current market turbulence is being monitored with experience and care. Our investment team only work for the clients of advisers within the Openwork network. They are only managing your money and the money of other people like you. Their sole priority is your financial well-being in every aspect of their work.

Our approach to investing is designed to insulate your money from the full turbulence of today’s markets. To ensures that you are well placed to be protected from impact during market turbulence and poised to take advantage of market opportunity when markets recover.

The portfolios that we recommend are matched to your appetite for risk and to your desired outcomes over the long term. Early indications even at this point show that this approach is working. Omnis investments, who manage some of our core portfolios, are providing performance updates on the Omnis website. If you would like to talk about your portfolios specifically, I am here to talk with you at any time.

Changes to how we work

It is our responsibility to support the continuation of good health across our community, while providing you with the support you need. So, we have taken the following steps within our practice to preserve our availability and service to you (to adjust as needed):

  • Face to face advice is a cornerstone of our practice but your health is more important. We are now working remotely and practicing reduced social contact across the team.
  • To stay in touch with you we have a range of technologies available – from the simple telephone call to online video chats using any one of (skype/ teams/ facetime) we can connect with you without requiring travel or close contact.
  • Some of our processes may be a little slower at times due to remote working or absence within the team, but we have confidence that you can still expect the same levels of care and diligence in every aspect of our work for you.

Importantly our firm is part of Openwork which is a partnership that has collectively provided financial advice for over 45 years. Together we have seen many changes in financial markets and provided support and guidance to two generations of clients, in good times and in bad.  Operationally this gives us strength and there are contingency plans operating across both our office here and everyone in Openwork to maintain that strength on your behalf.

The challenges we currently face will pass, and our main hope is that our team here, our clients and our communities emerge in health and strength.

Your sincerely

Adam Cockerham FPFS

Chartered Financial Planner

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested. 

Past performance is not a reliable indicator of future performance and should not be relied upon.

Newly appointed Chancellor of the Exchequer, Rishi Sunak, delivered his first Budget on 11 March, against a backdrop of uncertainty following the COVID-19 outbreak and subsequent financial losses. It was the first of two Budgets to be delivered in 2020, with the second to follow in the autumn.

COVID-19 and the NHS
The Chancellor wasted no time in diving into the heart of the issue on the minds of so many across the nation: the COVID-19 crisis. Taking an empathetic tone, he reassured the British public that “we will get through this together”, emphasising the temporary nature of the crisis and his firm belief in the ability of the British economy to weather the storm.

Mr Sunak then called on all parties across the House to support his £30bn fiscal stimulus, including welfare and business support, to “keep this country and our people healthy and financially secure”.

He pledged:

  • £5bn emergency response fund to support the NHS and other public services
  • Statutory Sick Pay (SSP) will be paid to all those advised to self-isolate even if they don’t have symptoms
  • To support businesses employing fewer than 250, the government would refund up to 14 days’ SSP
  • A Coronavirus Business Interruption Loan Scheme will support businesses experiencing increased costs or cashflow disruptions, providing access to £1bn of government-backed loans
  • Business rates in England will be suspended for 2020-21 for firms in the retail, leisure and hospitality sectors with a rateable value below £51,000
  • Any company eligible for small business rates relief will be allowed a £3,000 cash grant.

Mr Sunak promised an extra £6bn in NHS funding over the course of this Parliament, which would go towards hiring 50,000 more nurses and building 40 new hospitals.

The economy and business
On the morning of Budget day, the Bank of England (BoE) had announced an emergency cut in interest rates to bolster the economy amid the COVID-19 outbreak. BoE base rate was reduced from 0.75% to 0.25%, returning it to its lowest level in history. The BoE said it would also free up billions of pounds of extra lending to help banks support firmsMark Carney, the Governor of the BoE, was keen to emphasise that COVID-19 was a temporary economic shock, stating: “The Bank of England’s role is to help UK businesses and households manage through an economic shock that could prove sharp and large, but should be temporary.”

Mr Sunak also revealed that, not taking into account the impact of COVID-19, the British economy is forecast to grow 1.1% this year, then 1.8% in 2021-22, 1.5% in 2022-23 and 1.3% in 2023-24, while inflation is forecast to be 1.4% this year, increasing to 1.8% in 2021-2022. Borrowing as a percentage of GDP will be 2.1% this year, rising to 2.4% in 2020-21 and 2.8% in 2021-22.

Personal taxation and wages
The Conservative manifesto promised that during the course of this five-year Parliament, there will be no rise in the rates of Income Tax, VAT or National Insurance. From April, the Personal Allowance will be frozen at £12,500 before we start paying 20% Income Tax. Also frozen is the £50,000 threshold at which people start to pay the higher 40% rate of Income Tax. (Rates and thresholds may differ for taxpayers in parts of the UK where Income Tax is devolved.) The National Insurance threshold will rise to £9,500 from April, saving some 30 million workers around £100 a year.

As previously pledged, the new single-tier State Pension will increase from £168.60 a week to £175.20 in April. For pensioners receiving the older basic State Pension, this will increase from £129.20 to £134.25 per week (3.9% increase). The rise is the result of the triple-lock system, which means that the State Pension rises in line with inflation, earnings or 2.5%, whichever is the highest. The Conservatives have vowed to keep this in place for this term of Parliament.

Looking at Inheritance Tax (IHT), the main residence nil rate band will increase from £150,000 to £175,000 in 2020-21, as previously scheduled.

To support the delivery of public services, particularly in the NHS, the two tapered Annual Allowance thresholds for pensions will each be raised by £90,000. So, from 2020-21 the threshold income will be £200,000, meaning individuals with income below this will not be affected by the tapered Annual Allowance and the Annual Allowance will only begin to taper down for individuals who also have an adjusted income above £240,000.

For very high earners the minimum level to which the Annual Allowance can taper down will reduce from £10,000 to £4,000 from April 2020. This reduction will only affect individuals with total income over £300,000.

The 2020-21 tax year ISA (Individual Savings Account) allowance will remain at £20,000.

The JISA (Junior Individual Savings Account) allowance and Child Trust Fund annual subscription limit will be significantly increased from £4,368 to £9,000 in 2020-21.

The Lifetime Allowance for pensions will increase in line with the Consumer Prices Index (CPI) for 2020-21, rising to £1,073,100.

From 11 March the lifetime limit on gains eligible for Entrepreneurs’ Relief is reduced from £10m to £1m, in response to evidence that the costly concession has not been a major incentive to entrepreneurial activity.

Infrastructure and the environment
Mr Sunak announced a huge £600bn package, claimed to be the biggest investment in transport and infrastructure since 1955. Outlining the proposed spending on roads, rail including HS2, gigabit-capable broadband and housing by mid-2025, he said, in short: “if the country needs it, we will build it.” The package includes:

  • £2.5bn available to fix potholes and resurface roads over five years
  • £27bn to build or improve motorways and other arterial roads
  • Up to £510 million in shared rural network to improve 4G coverage
  • Allocation of £1bn from the Transforming Cities Fund
  • Flooding – £5.2bn over five years investment programme for flood defences and £120m in emergency relief for communities affected, £200m for flood resilience.

Environmental measures announced include:

  • Nature for Climate Fund – investing £640m in tree planting and peatland restoration
  • New plastic packaging tax from April 2022
  • Fuel subsidies for red diesel users will be abolished in two years, apart from agriculture, rail, fishing and domestic heating sectors.

Other key points

  • Priority to ensure people have affordable and safe housing – extending the affordable homes programme with £12.2bn funding
  • Supporting local authorities to invest in their communities by cutting interest rates on lending for social housing by 1%
  • £1.1bn allocation from the Housing Infrastructure Fund to build 70,000 new homes in high-demand areas
  • From April 2020, minimum wages will rise; for example, the National Living Wage for those aged 25 and above, will increase 6.2% to £8.72 per hour, and to a projected £10.50 by 2024
  • The 5% VAT on sanitary products will be abolished from 2021
  • Corporation Tax will remain at 19%
  • Fuel duty frozen for tenth consecutive year
  • Duties on all spirits, beer and wine frozen
  • The government will introduce a 2% Stamp Duty Land Tax surcharge on non-UK residents purchasing residential property in England and Northern Ireland from 1 April 2021
  • R&D investment of £22bn a year by 2024-25.

Closing comments
The Chancellor signed off his first Budget with these words: “We’re at the beginning of a new era in this country. We have the freedom and the resources to decide our own future. A future where we unleash the energy, inventiveness and creativity of all the British people. And a future where we look outwards and are confident on the world stage. That starts right now with our world-leading response to the coronavirus. This is a Budget delivered in challenging times. We will rise to this moment. We will get through this together.

Providing a retirement windfall for your child

Planning ahead and starting early can really help when it comes to building up a financial future for the children in your life. The Junior ISA (JISA) is a popular choice for many, but one often overlooked investment option is the ability to open a pension for your child, to help set them up for retirement.

Increasingly popular choice
Although retirement is a very long way off for your child, putting some money aside now means they can be one step ahead when they come to plan their retirement. Any parent or legal guardian can set up a pension, which will automatically transfer to your child once they reach the age of 18, at which time they can continue to contribute or leave the savings invested. Under current rules (which may be subject to change in the future) they can access the pension from age 55.

A valid option, worth considering
In addition to your own pension contribution allowances, people often don’t realise that they can also put money into someone else’s savings. If the recipient is a non-taxpayer, as most children are, they are still entitled to tax relief on any contributions made. Pension rules allow anyone to pay contributions on behalf of a child, so other family members such as grandparents can get in on the act too.

HMRC data indicates over 60,000 families have opened pension plans for their children. As personal pensions come with no minimum age restriction, many people opt to open one when their child is born.

Know the numbers
Current pension rules allow you to put up to £2,880 a tax year into a pension for a child. Tax relief of 20% means that this is then topped up to £3,600. No further Income Tax or Capital Gains Tax will be payable on the investments held in the personal pension, until your child starts taking benefits, (which currently cannot be before age 55). If you start pension contributions once a child is born and used the full allowance, the contributions would cost just under £52,000 over 18 years, and this, under current rules would be topped up by around £13,000 in tax relief.

Assuming growth in investments over the period, when the child reaches age 55 currently, they would have a sizable pension pot to draw upon, the spending power of which will of course depend on the passage of inflation over the intervening years.

Getting the balance right
Aside from retirement provision, you also need to consider providing financial assistance for more pressing priorities, such as university fees or money for a house deposit, or a wedding perhaps. Any pension savings won’t be available to help children with these financial priorities earlier in their adult lives. So, ideally a pension for your child should be regarded as part of a wider plan, rather than the only investment embarked upon.

Start a pension for your child today
With the full State Pension currently £168.60 a week, this is certainly not enough on its own to provide a comfortable retirement, so why not set the wheels in motion to provide a retirement windfall for your child? It’s also a great way to introduce your child to the concept of long-term saving. Families thinking about how to save and invest most efficiently during 2020 shouldn’t overlook pensions for children. Even if the full allowance isn’t contributed, any money saved could still provide a valuable nest egg at retirement.

If you would like to know more about investing for children, please get in touch.

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

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As yet another general election looms over the UK population, you could be forgiven for not quite feeling in the festive spirit. I think we can all agree no one really wants to be thinking about politics and the future of the country in December. I’m sure we would all much rather be sipping mulled wine and searching for the perfect Christmas tree.

With more uncertainty in the air we know that many of you might be concerned about what may lie ahead for your investment. It can be tempting at times like these to make short term decisions in an attempt to protect your money from the prospect of adverse market conditions. As understandable as this is, it goes against a basic principle which all investors should endeavour to follow – ‘time in the market, not timing the market’.

What do we mean by this? Well, it is quite normal for markets to rise and fall and Omnis strongly believe that with any uncertainty comes opportunity. They are both active and agile in approach and well positioned to be able to take advantage of these opportunities as they arise. Simply put, the Omnis aim is to use market fluctuations to buy low, sell high. By being an active investor, we are always looking for these opportunities.

As always, diversification – the concept of not having all your eggs in one basket – is a key investment principle which all investors should follow. Diversification is central to the Omnis approach when managing your money and key to protecting against unfavourable market outcomes. Omnis fund ranges, and portfolios are spread across a multitude of top tier fund managers, sectors, geographies and investment types. So, you can rest assured that your Omnis investments are being carefully managed with your long-term investment goals in mind.

We ensure your portfolio is only taking on as much risk as you are comfortable with, to meet your long-term financial goals. That’s why our partnership with your Omnis is so important to us.

Omnis are a long term active investment manager, and consider the wider, longer term impact of short term economic or political events. There will always be changes and challenges – it’s important to remember, that investing should not be considered with a short-term view.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Adam Cockerham is a member of The Personal Finance Society, The Society of Mortgage Professionals and The Chartered Insurance Institute

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