Investments  

Autumn Statement: What happened

“Britain’s economic plan is working, but the job is not done,” the chancellor George Osborne said in one of the most leaked statements in history.

Pensions

One of the biggest stories to come out of the Autumn Statement was the rise in state pension age. Based on the latest life expectancy figures the government plans to increase the age earlier than planned.

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It will go up from 68 in the mid-2030s to 69 by the late-2040s. April 2014 will also see state pensions rise by £2.95 per week, meaning pensioners are now £800 better off every year since the coalition was formed.

Pete Matthew, managing director of Penzance-based Jacksons Wealth Management, said, “People whine about this, but it has got to happen. I don’t think it will be a massive material difference.”

Isas

It was announced that Isa, Junior Isa (Jisa) and Child Trust Fund (CTF) annual subscription limits will all be increased in line with the consumer price index. The Isa limit for 2014-15 will rise by £360 to £11,880, half of which can be saved into a cash Isa. The annual allowance for Jisas and CTFs will rise to £3,840 from £3,720.

However, many advisers are disappointed there is still no mention of transferring CTFs into Jisas. Earlier in 2013, the chancellor said in his annual Budget the government would consult on allowing the transfer of savings, and asked for feedback until 6 August, although nothing has been mentioned since.

Mr Matthew said this was a “missed opportunity” from the government. “It feels like it’s not on their radar, like it is not important enough to do anything about.”

Economy

Figures from the Office of Budget Responsibility (OBR) show the UK has “reassessed the depth of the great recession”. It has also revised its UK growth forecast for 2013 from 0.6 per cent to 1.4 per cent. It has also increased for 2014 from 1.8 per cent to 2.4 per cent. For the next four years, annual growth is forecast at 2.2 per cent, 2.6 per cent, 2.7 per cent and 2.7 per cent respectively.

It added the fall in GDP from peak to trough between 2008 and 2009 was not 6.3 per cent as previously thought, but 7.2 per cent instead.

Tax

From April 2015, a new transferable tax allowance will be made available for married couples. Available to all basic rate taxpayers, it enables people to transfer £1,000 of their personal allowance to their wife, husband, or civil partner.

Mr Osborne also said the government is going to “tackle” the growth of intermediaries disguising employment as false self employment. Mr Matthew said this stood out to him as there are many advisers who are self-employed. “It’s something we have got to look at. It may come back to bite us,” he said.

Elsewhere, exchange-traded funds (ETFs) will have stamp duty and stamp duty reserve tax charge on purchases of shares removed if the vehicles are domiciled in the UK.