A relatively low-key budget when it comes to personal pensions and investments, with many of the predicted changes to pension tax relief etc not coming to fruition.
ISA allowances remain as was, with a maximum annual adult contribution limit of £20,000. Junior ISA’s and Child Trust Funds will continue to have a subscription limit of £9,000.
Turning to Pensions, the Lifetime Allowance for pensions will be frozen at £1,073,100 until April 2026. The Lifetime Allowance is a limit on the amount of pension benefit that can be drawn from pension schemes – whether lump sums or retirement income – and can be paid without triggering an extra tax charge. No changes were made to Annual Allowance, Money Purchase Annual Allowance or Tapered Annual Allowance figures or rules.
Some good news for those wishing to get on to or move up the property ladder with the announcement of the Mortgage Guarantee introduction from April 2021. This scheme will provide a guarantee to lenders across the UK who offer mortgages to people with a deposit of just 5% on homes with a value of up to £600,000. Under the scheme all buyers will have the opportunity to fix their initial mortgage rate for at least five years should they wish to. The scheme, which will be available for new mortgages up to 31 December 2022, will increase the availability of mortgages on new or existing properties for those with small deposits.
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