For many of our high net worth clients, one of the most important goals on their journey to financial freedom is the accumulation of a substantial pension fund. We ensure that our clients make use of all available tax allowances, and employ a blend of strategies designed to ensure that when they choose to retire they have built up substantial assets. In retirement, our focus is on the tax-efficient release of income.
Whilst retirement planning has become increasingly complicated for high net worth individuals, we create specific wealth management strategies that match your individual aims, objectives and circumstances, that utilises not only a range of pension structures, but also makes use of other tax allowances such as building an ISA portfolio and general investment account which can accumulate over a period and is subject to the more advantageous capital gains tax regime. For those with a higher risk appetite, then investment vehicles such as Enterprise Investment Schemes, Seed Enterprise Investment Schemes and Venture Capital Trusts can be effectively deployed. Our independence means we have access to the whole of market to find the best solutions for your needs.
If you are self-employed, in a partnership, a company director, business owner or executive, we can advise you on a wide range of pension arrangements, including Self-Invested Personal Pensions (SIPPs) and Small Self-Administered Schemes (SSASs). As part of our holistic approach to your finances, we will also advise you on income drawdown, cashflow management and Inheritance Tax planning.
Download our Tax guide
Download our Retirement Wellbeing guide
Back in April 2015, the government introduced some of the most significant and far-reaching changes to pension legislation in almost a century. Launched under banner of “Freedom & Choice”, this raft of measures has brought greater flexibility and choice to individuals and their families. We help clients ensure that financial freedom is reached as early as possible, meaning that the choice to work is often based on intellectual or entrepreneurial passion.
Whilst governments can give, they can also take away. At the same time, the Money Purchase Annual Allowance limited the annual contribution to money purchase schemes to £4,000 rather than £40,000 if any of the new freedoms had been accessed.
Those whose earnings exceed £200,000 and have combined income and pension contributions in excess of £240,000 will also see their contribution limit reduced to potentially as low as £4,000. And then of course there’s the Lifetime Allowance which for 2020/21 stands at £1,073,100.
However, pensions still provide a tax-efficient way of providing for your future income needs. For example, subject to the limits and thresholds, a higher rate tax payer (40%) receives immediate tax relief of 20%, and can claim a further 20% through their tax return. This means that they can make a contribution to their pension of £10,000 which will in effect cost them just £6,000.
For further information on how we can help you build and protect your wealth, please contact us.
