1. Your business logo (printed in full-colour), photograph (if required) & business name here. To place an order, or to find out more information, call our sales team on: (0845) 686 0055 or email sales@goldminemedia.co.uk MARCH / APRIL 2012Navigating Why end-of-tax-yearplanning should nowthe pensionsbe high on your agendalandscapeProper tax and financial planning canlower and defer the tax you payThe future is always unknown,Estate planning requiresbut when it comes to retirementa strong foundation and ait pays to be in the knowclear plan of action Have you made sureyour beneficiaries will be looked after? ttheA Bea il IS e Apr dlstions a indeour queered Yw ansThe principal tenetsof spreading risk in your portfolio A change in the calendardoes nothing to change the investment outlookYour contact details & regulator details here.

2. Welcome ProtectionEditorial Families find discussingT their finances andhe end of the tax year is fastapproaching and marks amortality uncomfortablesignificant period of pensionchange as a result of theFinance Act 2011. The future isalways unknown, but when it comesto retirement it pays to be in theThe effects of ignoring the issue and failing toknow. On page 06 we look at someof the areas where clever pensionappreciate the value of protecting your familyplanning between now and 5 AprilThe latest Aviva Family Finances Report reveals that many UK families are2012 could provide tax-advantageousputting luxuries ahead of protecting their loved ones financially.solutions for you to achieve theretirement you want.The report discovered that while 50 per cent of time. As a result, many families ignore the Estate planning should start early families are happy to pay for a satellite televisionissue and fail to appreciate the value ofin life and is for everyone, not just package, just 40 per cent have life insurance. It protecting their family compared to spendingthe very wealthy. It is about ensuringalso found that families are more likely to haveon other items.control of your estate and planning insurance for their mobile phone (14 per cent)ahead so there are no uncertainties than insurance that will protect their family Avoiding putting measures in placeabout how it is managed in thefinancially if they were to suffer a critical illness No one likes to dwell on poor health orfuture. On page 04 we consider(13 per cent).mortality, but by denying that illness or worsehow you could minimise the effectSimilarly, more people have taken out an is even a possibility, people are avoidingof Inheritance Tax and ensure thatextended warranty on electrical items (13 per putting measures in place to protect their lovedyour beneficiaries are looked after,cent) than have income protection insurance,ones. Too many people assume that someoneespecially young children or anywhich would potentially pay an income for lifeelse will step in and look after their families ifdependants who may be vulnerableshould they be unable to work as a result of an they werent there to provide for them, but theand need special care.accident or illness (10 per cent).reality is very different. A review of your financial and taxplanning to maximise your net incomeLack of understanding UNNECESSARY RISKand your business and family assets The report also reveals that the majority ofPeople need to ask themselves just how theyshould now be high on your agenda UK families are avoiding the issue of whatwould pay for their mortgages, their foodprior to the tax-year end on 5 Aprilthey would do if something happened to an and all the other costs of living should they2012. On page 10 find out about income earner because they find discussingsuddenly lose an income. While no one likes tohow proper tax and financial planning their finances and mortality uncomfortable. think about what ifs, by not even consideringcould lower and defer the tax you This is in spite of the financial worries thatthese scenarios, people could be putting thepay, freeing up cash for investment,could be caused by not having protection, future financial security of their families atbusiness or personal purposes.exacerbating emotional distress at a difficultunnecessary risk. n A full list of all the articles featuredin this edition appears opposite. nWant help reviewing yourContent of the articles featured in thispublication is for your general informationprotection strategy?and use only and is not intended to address The right protection strategy canyour particular requirements. They shouldprotect you and your family fromnot be relied upon in their entirety andshall not be deemed to be, or constitute, unnecessary financial hardship.advice. Although endeavours have been We can help you select the rightmade to provide accurate and timely protection solutions for yourinformation, there can be no guaranteesituation, so please contact us tothat such information is accurate as of thedate it is received or that it will continue to discuss your requirements.be accurate in the future. No individual orcompany should act upon such informationSource The Aviva Family Finances Report is anwithout receiving appropriate professionaladvice after a thorough examination ofin-depth study into the financial needs of thetheir particular situation. We cannot accept84 per cent of the UK population who live as partresponsibility for any loss as a result ofof a modern family.acts or omissions taken in respect of any Data was sourced from the Aviva Family Index, whicharticles. Thresholds, percentage rates and taxlegislation may change in subsequent Financeused findings from over 10,000 people who areActs. Levels and bases of and reliefs frommembers of one of the six groups of families identifiedtaxation are subject to change and their valueabove via Opinion Matters. This report is a definitivedepends on the individual circumstances ofappraisal of the personal finances of families in thethe investor. The value of your investmentsUK. Not only does it look at personal wealth, incomecan go down as well as up and you may getback less than you invested.sources and expenditure patterns, but also tracks howthese change across the different types of family unit.02 3. 06 IN THIS ISSUE ss iscu ialo d inanc T fr ingyou lannments p iretainIn this issueu req to ober 08or furth tion, rma e infopleast us accont02Families find discussingtheir finances and08 Expected retirement incomes hit five-year lowmortality uncomfortableTaking some practical stepsThe effects of ignoring the issue andnow could mean a morefailing to appreciate the value of comfortable retirementprotecting your family04Estate planning requires09 The PRINCIPAL tenets of spreading risk ina strong foundation andyour portfolioa clear plan of action A change in the calendar does nothingHave you made sure yourto change the investment outlookbeneficiaries will be looked after?10 Why end-of-tax-year05 09Growing up is hard to do planning should now beWhy we are adopting a more maturehigh on your agendaapproach to handling our financesProper tax and financial planning can lower and defer the tax you pay06Navigating the1112pensions landscape Are you gettingThe future is always unknown, butcloser to retirement?when it comes to retirement it paysBeing able to retire when and howto be in the knowyou want to07Beat the April ISA deadlineYour questions answered 12 Cost of raising a child increases to 218,000 Parents would rather do without themselves than radically cut back on what they can provide for their children want to make more of your money IN 2012? For more information please tick the appropriate box or boxes below, include your personal details and return this information directly to us. n Arranging a financial wealth checkName n Building an investment portfolioAddress nGenerating a bigger retirement income n Off-shore investments n Tax-efficient investments n Family protection in the event of premature death n Protection against the loss of regular income n Providing a capital sum if Im diagnosed with serious illness Postcode n Provision for long-term health care Tel. (home) n School fees/further education funding n Protecting my estate from inheritance tax Tel. (work) nCapital gains tax planning Mobile nCorporation tax/income tax planningEmail nDirector and employee benefit schemes n Other (please specify) You voluntarily choose to provide your personal details. Personal information will be treated as confidential by us and held in accordance with the Data Protection Act. You agree that such personal information may be used to provide you with details and products or services in writing or by telephone or email.03 4. Wealth protectionEstate planning requiresa strong foundation anda clear plan of actionHave you made sure your beneficiaries will be looked after?Estate planning should start early in life and is for everyone, not just the very wealthy. It is about ensuringcontrol of your estate and planning ahead so there are no uncertainties about how it is managed in the future.Minimise the effect of tax n Certain gifts that you have made in the individuals who are not UK resident or not UKIt can also help minimise the effect of taxlast seven years domiciled are different and therefore tax andand ensure that your beneficiaries are n Assets held in trust from which you local laws should be considered.looked after, especially young children or receive personal benefitany dependants who may be vulnerable n If you own assets jointly, your share of Planning for IHTand need special care. Inheritance Tax (IHT) their value is included in your estate There are a number of things you couldis a tax on your estate the things that do to reduce your familys potentialbelong to you when you die and is also IHT mattersIHT bill:sometimes payable on trusts or gifts madeFor the 2011/12 tax year, no IHT isduring your lifetime.charged on the value of your estate up toMake a Will an effective Will could help IHT is often called a voluntary tax 325,000. This is known as the nil rate to reduce your IHT billbecause, with careful planning, the amount band and everything above that is taxed atLook into exemptions there are ayour estate has to pay could be reduced40 per cent. number of exemptions you could useor removed completely. From writing aIf your IHT nil rate band is not used up to reduce the value of your estate. ForWill, to understanding the exemptions andon your death, the unused proportion can example, moving assets between spousesmaking lifetime gifts, there are currently be transferred to your surviving spouse or or registered civil partners does not createseveral options to help mitigate IHT.registered civil partner.an IHT liability Your estate includes the total of Assets passed to your spouse orConsider gifts if you can afford to giveeverything you own and a share ofregistered civil partner are exempt from away some of the assets that you own, it mayanything you own jointly. Things that mightIHT (assuming your spouse or partner isbe possible to reduce the size of your estatecount towards your estate include: domiciled in the UK), regardless of your Think about life assurance a life worth and how soon you die after makingassurance plan wont actually lessen then Propertythem. These rules also apply to gifts made IHT bill, but the proceeds could be used ton Investmentsto charities.help pay the bill on death if written in ann Insurance (not written in anAdditionally, any amount of money youappropriate trustappropriate trust) give away outright will not be counted Consider trusts if structured carefully,n Payment from a pension plan orfor IHT if you survive for seven years after trusts can help to reduce or even eliminateemployee death benefit (unless inmaking the gift. If you die within thisyour IHT liability na trust) period, the amount of the gift will ben Other assets, for example, cars, art,included within your estate. Taper reliefTax laws are subject to change, possiblyjewellery, furniture may also apply in these circumstances andretrospectively. The rules for individuals whon Gifts you have made but still benefit could reduce the amount of IHT due. are not UK resident or not UK domiciled arefrom, for example, a house you haveBear in mind tax laws are subject to change, different and therefore tax and local lawsgiven away but still live in possibly retrospectively. Also, the rules forshould be considered by a potential investor.04 5. IN THE News Growing up is hard to doTrust in your futureThe structures into which you can transferyour assets can have lasting consequencesfor you and your family and it is crucialthat you choose the right ones. The rightWhy we are adopting a more maturestructures can protect assets and give yourfamily lasting benefits. approach to handling our finances A trust can be used to reduce howmuch IHT your estate will have to pay on While 18 is traditionally seen to be the age at which we becomeyour death. A trust, in principle, is a very adults, as a nation we are beginning to delay taking on the roles andsimple concept. It is a legal arrangementresponsibilities adulthood brings, according to new findings fromwhere the ownership of someones Scottish Widows Attitudes to Planning survey.assets (such as property, shares or cash)is transferred to someone else (usually aGrown up per cent) into second place. Leaving full-timesmall group of people or a trust company)Nearly half the population (47 per cent) doeducation (13 per cent) came in third.to manage and use to benefit a third not feel like a responsible grown-up in allperson (or group of people). areas of life until the age of 25, with a thirdFuture plans There are basically several different types (33 per cent) of Britons not feeling like an These figures support the earlier findingsof trust to choose from, however the onesadult until they are 26 or over. Surprisingly, of the report, which showed the youngermost commonly used are Bare Trusts and a massive 49 per cent of those who dont generation leading the way when itDiscretionary Trusts.feel like a grown-up believe they will never comes to planning for the future. By the feel like a grown-up.time Britons hit their mid-30s, nearly halfDiscretionary TrustHowever, perhaps the nation is growing (48 per cent) say that they like to planA Discretionary Trust offers flexibility whenup more quickly than they think, as Britonswhat their lives will look like, comparedit comes to deciding whom you would like are starting to take control of their moneyto just a third (31 per cent) of those agedto be the Beneficiaries. You (as Settlor ofmatters at an early age, which could 35 and above. These future plans arethe Trust) together with the Trustees cansuggest that growing unemployment andclearly weighing on their minds, withchange who the Beneficiaries are at anyan uncertain economic climate could be half (50 per cent) of 18 to 34-year-oldstime. The Trustees have ultimate discretiondoing this.already worried that they havent spentto allocate capital and income to any ofenough time planning for retirement. nthe Beneficiaries. Financially responsible However, with a Discretionary Trust On average, well over half (58 per cent) ofthere are possible tax liabilities to be people felt financially grown-up by the timeaware of. So, if you transfer assets tothey were 26 years old. Getting their first joba Trust within seven years of death, was found to be the number one life stage atdepending on the value of assets in thewhich most Britons (29 per cent) started to feelTrust there could be further charges tofinancially responsible, placing marriage (14consider during the lifetime of the Trust.Bare TrustA Bare Trust ensures that, once named,48%the Beneficiaries cannot be changedBy the time Britonsor added to in the future. Once agedhit their mid-30s,58%18, a Beneficiary can ask for the trustnearly half say thatto pay their share to them directly. Thethey like to planmajor advantage of Bare Trusts overwhat their lives will Percentage ofDiscretionary Trusts is that they arelook likepeople who feltclassed as Potentially Exempt Transfersfinancially grown-up bywith no immediate or ongoing IHT the time they were 26charges, provided the creator of the trustyears oldsurvives more than seven years from thedate of the transfer. Want TO FIND OUT MORE? For further information about the services we offer and to discuss how we could help you protect your wealth for you and your family, please contact us for further information.05 6. Retirement 5 April 2012Clever pension planning before this date could provide tax-Navigating theadvantageous solutions for you to achieve theretirement you wantpensions landscape 1.8m Lifetime allowance for 2011/12The future is always unknown, but when it comes toretirement it pays to be in the knowThe end of the tax year is fast approaching and marks a significant period of pension change as a result of theFinance Act 2011. The future is always unknown, but when it comes to retirement it pays to be in the know.These are some of the areas where clevertax year is used first, ensuring the pensionRecycling of unused incomepension planning between now andinput period for this contribution ends no withdrawals as allowable contributions5 April 2012 could provide tax- later than 5 April 2012. minimum 3,600 but could be higher ifadvantageous solutions for you to achieve Employer contributions to reduce you have relevant earnings.the retirement you want.taxable profits in trading periodsGifting income using normal Subject to 50 per cent income tax payending before 5 April 2012 these expenditure from drawdown fundspersonal contributions within 100 per cent of can be used for carry forward of unused reduces potential 55 per cent taxrelevant earnings threshold to reduce taxable annual allowances, for the current annualcharge on death from drawdown fund,income below the 50 per cent threshold. allowance and for the 2012/13 tax year.while ensuring future growth is with Adjusted relevant income overRegistering for fixed protection thisthe beneficiary and not part of taxable114,950 pay personal contributions must be completed no later than 5 Aprildrawdown fund. Funding third-partyto registered schemes to reduce taxable 2012. 2011/12 is the last tax year in whichcontributions to pension arrangements ofincome below 100,000, enabling yourmoney purchase contributions can be paid children or grandchildren is an option.full personal allowance to be regained andif fixed protection is to apply. Maximise thisEarly crystallisation for some peopleproviding marginal rate tax relief of years annual allowance plus carry forward aged over 55 crystallising benefits this60 per cent on contributions paid of unused relief for pension input periods tax year while the lifetime allowance isbetween 114,950 and 100,000.ending in 2008/09 to 2010/11 tax years.1.8m will create higher retained lifetime Carry forward of unused annual Clever use of pension input period planningallowance for future use. nallowance from 2008/09 this will be will allow funding of 2012/13 annuallost if not used. You must ensure the fullallowance this tax year to maximise input.50,000 annual allowance for the 2011/12 Want to discover why a pension is a wise investment choice? There have been some significant changes to financial legislation in the past 12 months and you may be unaware of your entitlements. For more information about how you could benefit from some of the tax planning opportunities that pension funding could provide over the coming weeks, please contact us for further information.. A pension is a long-term investment. The fund value may fluctuate and can go down as well as up. You may not get back your original investment. Past performance is not anindication of future performance. Tax benefits may vary as a result of statutory change and their value will depend on individual circumstances. Thresholds, percentage rates and tax legislation may change in subsequent Finance Acts.06 7. Wealth creationBeat the AprilISA deadlineYour questions answeredQ: What is an Individual SavingsQ: How much can I contribute to an ISA?Account (ISA)?A: Your annual ISA allowance is 10,680A: ISAs were set up to give you tax in the 2011/2012 tax year. Of this, up Q: What is a Junior ISA?advantages on your savings andto 5,340 can be saved in a Cash ISA A: A Junior ISA is a tax-efficient wayinvestments. There are two types of ISA:with one provider. All of your allowance to save for a childs future and can beCash and Stocks & Shares. You can earnor the remainder can be invested in aset up in the childs name by a parentinterest free of UK income tax with a CashStocks & Shares ISA. Bear in mind that the or guardian. You can set up a Stocks &ISA and interest free of UK income andvalue of tax relief depends on individualShares ISA or Cash ISA or a combinationcapital gains tax with a Stocks & Shares ISA. circumstances and tax rates are subject to of both and any investment growth ischange; if you dont pay tax, you will not free of UK income and capital gains tax.Q: Am I eligible for an ISA?benefit from any tax relief. Annual limits are The annual investment limit is currentlyA: To open an ISA you have to be aged also subject to review and the governments3,600, but this will rise in line with16 or over if the ISA is a Cash ISA or 18 orfavourable tax treatment of ISAs may not inflation from 2013. The money is lockedover if the ISA is a Stocks & Shares ISA. You be maintained. away until the child reaches the age ofhave to be resident and ordinarily resident18, giving the investment time to grow.in the UK for tax purposes, or a CrownQ: What are my annual ISAThe child is the beneficial owner of theemployee, such as a diplomat or a memberallowance options? Junior ISA. Children are not eligible for aof the armed forces, who is workingJunior ISA if they have or were eligible foroverseas and paid by the government. Individual Savings Accounta Child Trust fund. n Subscription LimitsQ: What is the difference between aTax Year2011/2012Cash ISA and a Stocks & Shares ISA? Need help making theA: A Cash ISA is like a normal savings account,Cash ISA Limit5,340right ISA decision?but you dont have to pay UK income tax on Stocks & Shares ISA Limit 10,680your interest, provided all ISA conditions areTime is running out if you want to Total ISA Limit 10,680met. Some Cash ISAs are offered as a fixed- take full advantage of your ISAterm or fixed-rate account. allowance before the tax-year endon 5 April. Remember, if you dont A Stocks & Shares ISA allows you toQ: I have used all my annual Cash ISAfully utilise your ISA allowancepurchase investments in a tax-efficient allowance for this tax year. Can I stillby this date it will be lost forever.manner your returns are free of UKcontribute more?So whatever your wealth goalsIncome and Capital Gains Tax. As your A: As your total ISA allowance is 10,680, if might be, we can help you put thatmoney is invested directly or indirectlyappropriate, you could still invest a further plan into action. To discuss yourin stocks and shares, the value of your 5,340 in a Stocks & Shares ISA.ISA options, please contact us forinvestment can rise or fall so you could endfurther information.up with less than you invested. The tax Q: How many ISAs can I have?credit on an ISA dividend is not recoverable.A: There is no limit on the number of The value of these investments and the The Stocks & Shares ISA wrapper lets you ISAs you can hold, but you can only income from them can go down as well asinvest in funds that have no fixed maturity open and subscribe to one Cash ISAup and you may not get back your originaldate, although they are designed to be held and one Stocks & Shares ISA per tax investment. Past performance is not anfor the medium to long term (usually five year. This could be a Cash ISA with indication of future performance. Taxto ten years). Their value at any particularone provider and a Stocks & Shares ISAbenefits may vary as a result of statutorytime will always depend on how well the with a different provider, or both withchange and their value will depend onunderlying investments perform, so if thisthe same provider. However, be sureindividual circumstances. Thresholds,has been poor it could be less than the that you dont exceed the maximumpercentage rates and tax legislation mayoriginal amount you invested, irrespective of amount youre allowed to put into change in subsequent Finance Acts.how long you have held the investment.ISAs each year. 07 8. Retirement18%Percentage of thoseplanning to retire in 2012 who have no idea of the level of income they will needExpected retirement to live comfortably 37%incomes hit five-year lowFewer than two in five ofthe Class of 2012 say that they have saved enoughto secure a comfortableTaking some practical steps now couldretirementmean a more comfortable retirementPeople retiring in 2012 expect to live on an average annual income of 15,500 over 1,000 a year less(6 per cent) than those who retired in 2011. The figures come from Prudentials unique Class of 2012 research,which provides insights into the financial expectations of Britons planning to retire in the next 12 months.Expected annualThe perfect storm taking some practical steps now, workersretirement incomes The current economic climate has createdand imminent retirees could ensure a moreThe results of Prudentials annual survey, first the perfect storm for people in the run-up to comfortable retirement. For those whocarried out in 2008, show that expectedretirement. The impact of the credit crunch,are still working, it has never been a moreannual retirement incomes have dropped banking crisis, recession and concerns over important time to save into a pension.by more than 16 per cent in the last fivethe Eurozone has been reflected in the fact However, even if you are due to retire thisyears. The Class of 2008 retirees looked that expected retirement income levels have year, you could still make your retirementforward to a total annual income, includinghit a five-year low.funds generate better incomes. nprivate, company and State pensions, of It is concerning that expected retirementapproximately 18,600 3,100 a yearincomes are going down, while pensionerNeed ideas about savingmore than those planning to retire this year.expenditure is going up. However, by for your retirement?As a sign of the ongoing financialchallenges facing those due to retire inTo discuss how we could help youto make more informed pension2012, one in five will get by on an expectedsaving and retirement incomeannual income of less than 10,000. Fewer decisions, please contact us.than two in five (37 per cent) of the Classof 2012 say that they have saved enough tosecure a comfortable retirement.Source Online survey conducted byResearch Plus on behalf of PrudentialGender differencebetween 2 and 12 December 2011Men are more optimistic about theiramong 9,614 UK non-retired adultsretirement than women, with 45 peraged 45+, including 1,003 retiring incent of men confident they will be 2012. All retirement income figuresfinancially comfortable comparedwithin this release are rounded to thewith 31 per cent of women. However, nearest hundred.nearly one in five (18 per cent) of thoseplanning to retire in 2012 have no ideaof the level of income they will need inorder to live comfortably.08 9. InvestmentThe principal tenets ofspreading risk in your portfolioA change in the calendar does nothing to change the investment outlookOne of the principal tenets of spreading risk in your portfolio is to diversify your investments whateverthe time of year. Diversification is the process of investing in areas that have little or no relation to eachother. This is called a low correlation.Diversification helps lessen whats known as 2: Sector4: Companyunsystematic risk, such as reductions in the Once youve decided on the assets you want Its important not to invest in just onevalue of certain investment sectors, regions in your portfolio, you can diversify further company. Spread your investments across aor asset types in general. But there are someby investing in different sectors, preferablyrange of different companies.events and risks that diversification cannot those that arent related to each other.The same can be said for bonds andhelp with these are referred to as systemicFor example, if the healthcare sector takes property. One of the best ways to do this isrisks. These include interest rates, inflation, a downturn, this will not necessarily have via a collective investment scheme. This typewars and recession. This is important to an impact on the precious metals sector. of scheme invests in a portfolio of differentremember when building your portfolio. This helps to make sure your portfolio isshares, bonds, properties or currencies to protected from falls in certain industries.spread risk around.Five main ways you candiversify your portfolio 3: Geography 5: Beware of1: AssetsInvesting in different regions and countries over -diversificationHaving a mix of different asset types will can reduce the impact of stock marketHolding too many assets might be morespread risk because their movements aremovements. This means youre not justdetrimental to your portfolio than good. Ifeither unrelated or inversely related to eachaffected by the economic conditions of one you over-diversify, you may be holding backother. Its the old adage of not putting all country and one governments fiscal policies. your capacity for growth as youll haveyour eggs in one basket. Many markets are not correlated such small proportions of your money in Probably the best example of this iswith each other if the Asian Pacific different investments that you wont seeshares, or equities, and bonds. Equities are stock markets perform poorly, it doesnt much in the way of positive results.nriskier than bonds, and can provide growth necessarily mean that the UKs marketin your portfolio, but, traditionally, when thewill be negatively affected. By investing inThe value of these investments and thevalue of shares begins to fall bonds begin todifferent regions and areas, youre spreadingincome from them can go down as wellrise, and vice versa.the risk that comes from the markets. as up and you may not get back your Therefore, if you mix your portfolio Developed markets such as the UK andoriginal investment. Past performance is notbetween equities and bonds, youre US are not as volatile as some of those in an indication of future performance. Taxspreading the risk because when one dropsthe Far East, Middle East or Africa. Investing benefits may vary as a result of statutorythe other should rise to cushion your losses.abroad can help you diversify, but you needchange and their value will depend onOther asset types, such as property andto be comfortable with the levels of risk that individual circumstances. Thresholds,commodities, move independently of eachcome with them.percentage rates and tax legislation mayother and investment in these areas canchange in subsequent Finance Acts.spread risk further. 09 10. Wealth protectionWhy end-of-tax-year planningshould now be high on your agendaProper tax and financial planning can lower and defer the tax you payA review of your financial and tax planning to maximise your net income and your business andfamily assets should now be high on your agenda prior to the tax-year end on 5 April 2012.Proper tax and financial planning couldGeneral planning Up to 5,340 can be invested in a Cashlower and defer the tax you pay, freeing and tax shelters ISA, the balance held in a Stocks & Sharesup cash for investment, business orReduce exposure to the 50 per cent tax ISA.The tax credit on an ISA dividend ispersonal purposes. With the 40 per rate and/or minimise the loss of personalnot recoverable.cent threshold coming down as the taxallowances by deferring income intopersonal allowance goes up, there are2012/13 where possible, or acceleratePension rule changesstill ways for higher rate taxpayers toexpenditure into 2011/12.Making pension contributions reducesmaximise their allowances ahead of theConsider selling assets that stand at a taxable income.tax-year end.loss in order to crystallise that loss for usePension rule changes and the transition against current year gains.to the new annual and lifetime limitsMaking sense of yourReview your investments to see if any in 2011/12 provide opportunities.planning and financeshave become of negligible value whichIn particular, people who have beenFrom 6 April 2012 the threshold forcould crystallise a useable loss.prevented from making pension provisionshigher rate will be taxable income of If you have more than one residence,greater than the 20,000 special annual34,371, down from 35,001. So,make sure you dont miss the allowance may be able to increase theireven after including the increase in the opportunity to minimise CGT by electingpension provision in 2011/12 by usingbasic personal allowance from 7,475 within two years of any change inunused allowances brought forward underto 8,105 the normal higher rate combination of residences. the new pension regimes transitional rules.threshold will remain at 42,475. For withdrawals from 6 April 2012, The annual allowance for contributionsWe can help you make sense ofcurrency gains and losses will be taken outis 50,000. Any unused allowance maythe areas you need to consider for of the tax net, so avoid crystallising gains be carried forward for three years, butyour planning and finances, which is early but be sure to trigger losses before anything unused from 2008/09 will be lostessential with the ever-changing tax that date. after 5 April 2012.laws and the wide range of financial The lifetime allowance reduces to 1.5mproducts and solutions available. BelowRevisit deceased estates from April. Consider if benefits should beare some of the main areas that youIf a relative has died within the past two taken or registered for fixed protectionmay wish to consider discussing with usyears, a rearrangement of their estate before 6 April 2012.before the tax-year end. could put income into the hands of family members whose income level isMarried couplesbelow the 40 per cent or 50 per centMarried couples should consider whetherincome tax threshold.equalisation or joint ownership ofinvestments will transfer income to theIndividual Savingslower-taxed one. This can be done free Account (ISA)of capital gains tax (CGT) for married An ISA provides saving andcouples and registered civil partnerships. investment in a tax-efficient Unmarried couples can equalisenon-CGT assets such as bank accounts environment. The current annual ISA subscription 50,000and may find it possible to equalise orlimit is 10,680. The annual allowancetransfer assets on which gains are lessthan their annual CGT exemption. Even for pensioncontributions10,680if an asset is put into joint ownership The 2011/12only the day before it produces income annual ISA for example, through interest or asubscription limitdividend that income will still be splitequally between both owners.10 11. RetirementInheritance Tax (IHT)Use the annual exempt amount of 3,000, the smallgifts exemption of 250 per recipient and makeregular gifts out of income. Any death benefits from pension arrangementsand life assurance policies should be written in anappropriate trust, so that any proceeds are outside Are you gettingthe estate. Consider lifetime gifts so the seven-year clockstarts to run to mitigate IHT on death. closer to retirement? Review Wills, powers of attorney and estateplanning arrangements. n Being able to retire when and how you want to Making your savings grow and being able to retire when and how you Do you have the bestwant to is likely to be one of your most important financial objectives, strategies in place to grow but achieving this goal requires planning and perseverance. and protect your wealth? With the tax-year end rapidly approaching, The closer you get to retiring, theThere are still steps you could take there is no substitute for professional greater the need to preserve your to boost the income youll get when advice. No matter what your age,savings and ensure they will last you retire. personal or financial status, we can help you make well-informed decisions all through your retirement. If you It may also be appropriate to to ensure that you and your family areare approaching retirement, do youcombine your various savings pots following the best strategies to grow and need to make any further changesto make managing your money protect your wealth. Please contact usto your investments?easier. As you get older you may for further information. You may think you have yourappreciate the simplicity of having retirement planned, but could a everything in one place. nLevels and bases of and reliefs from taxationpension shortfall catch you out? are subject to change and their value depends onthe individual circumstances of the investor. TheBoosting your value of your investment can go down as wellretirement savingsas up and you may not get back the full amount If you invest in non-pension savings, invested. Tax laws are subject to change, possiblyyou can use these to supplementretrospectively. The rules for individuals who are your pension savings and still not UK resident or not UK domiciled are different access your money if you need to.and therefore tax and local laws should beEnsure you have the right mix of considered by a potential investor. investments, which could help your savings outpace inflation.If you are approaching retirement you will generally be able to take up to 25 per cent of your pension fund as a tax-free lump sum. You could use it to supplement your retirement income by reinvesting in a flexible investment. Its not too late to improve your retirement finances Wherever you areIs your pension with your retirementplanning still savings, dont beon track? put off from Your pension may be up and taking action running, but thats not the end its not too late. of the story. Its important thatyou review your payments,particularly if you have achange of circumstances. Tomake sure that your pensionplanning is still on track,please contact us to discussyour requirements.11 12. IN THE NewsCost of raising achild increases to 218,000Parents would rather do without themselves than radically cut backon what they can provide for their childrenThe annual Cost of a Child Report [1]from protection and retirement specialist LV=, reveals the cost of raising a child frombirth to their 21st birthday now totals a record 218,024. This equates to 10,382 a year, 865 a month or 28.44 a day.Overall costLong-term picture Economics and Business Research (CEBR) onThe report shows that the overall costWhen considering ways to ease the family behalf of LV= in December 2011 and areof raising a child has increased by budget, it is important that you keep in based on the cost for the 21-year period to3.3 per cent in the last year, with education mind the long-term picture. Cancelling lifeDecember 2011. The report also includesand childcare remaining the biggest cover or income protection, for instance, omnibus research conducted for LV= byexpenditures, costing parents a massive as a short-term measure to save money Opinion Research from 3-5 January 2012.71,780 and 62,099 respectively. The costcan have catastrophic implications if either The total sample size was 2,119 UK adults.of education, including school uniforms,parent were unable to work or werentResults have been weighted to nationallyafter-school clubs and university tuition around in the future. representative criteria.fees, has experienced the biggest rise, witha 5 per cent increase in spending over theParents dontpast year.begrudge the moneyThe overall cost of raising a child has Despite an uncertain UK economy forcingincreased by 55 per cent since LV=s firstmore pressure on the family budget, itsCost a Child Report in 2003.clear that parents dont begrudge themoney they spend on their children, andNot protectingwould rather do without themselvesthe familys future than radically cut back on what they canSome 50 per cent of parents dont haveprovide for their children. nany life cover or income protection in place.Just a third (32 per cent) of parents have lifeSource [1] The Cost of a Child Reportcover and only 11 per cent have both lifecalculations, from birth to 21 years, havecover and income protection.been compiled by the Centre forThe costs in detailExpenditure fromTotal % difference% difference from 2003birth to age 21costfrom last year - first year of the reportEducation*71,780 5.1% 120%Childcare& babysitting 62,099 2.7%57%Food18,667 4.0%25%Clothing10,781 3.7%-5%Holidays15,532 1.6%36%Hobbies & toys 9,248-4.6% 4%Leisure& recreation 7,303-0.6%15%Pocket money 4,337 4.8%28%Furniture3,373 2.5%62%Personal care1,143 2.6%24%Other (includes driving lessons, first car, 13,761 4.8%56%birthday and Christmas presents)TOTAL218,024 3.3% 55%*Does not include private school feesPublished by Goldmine Media Limited,Prudence Place, Luton, Bedfordshire, LU2 9PEArticles are copyright protected by Goldmine Media Limited 2012.Unauthorised duplication or distribution is strictly forbidden.