Tax notifications added to Cashcalc tool

Tax notifications added to Cashcalc tool

Cashflow planning software provider Cashcalc is set to introduce a function to its modelling tool which notifies advisers when their clients are at risk of breaching their pension allowance.

Cashcalc is expected to introduce tax to its cashflow modeller tool in the summer, which will allow advisers to start accounting for tax rates and thresholds when showing clients their expected cashflow over a specific period.

The new function will also alert advisers when their clients are at risk of breaching the lifetime allowance and the money purchase annual allowance (MPAA).

The lifetime allowance, which is currently £1,055,000, is a limit on the amount of pension benefit that can be drawn from pension schemes and can be paid without triggering an extra tax charge.

The MPAA, introduced in 2015 to coincide with pension freedoms, is the amount a person who has already begun drawing from their pension can pay back into their retirement pot in a given year without incurring a tax charge.

The allowance was cut from £10,000 to £4,000 in April 2017, following an announcement in November 2016.

Cashcalc decided to launch the tax feature after receiving feedback from advisers over the course of 2019.

The software provider is also looking to improve its integration systems to avoid advisers having to enter data twice.

It wants to further upgrade its data capture forms so that clients will be able to add more in-depth information such as frequencies to incomes and expenses. Advisers will also have the option to add questions.

In the first quarter of this year Cashcalc will launch a client facing login area. This will allow clients and advisers to share and sign documents, such as fee agreements and terms of business.

Ray Adams, director of Cashcalc and chartered financial planner, said: “I’ve always been of the mindset that technology should help advisers deliver their advice, not dictate to them what to do or how to do it. 

“Our plan for 2020 is targeted towards exactly that and I am pleased we have been able to share with everyone what we have in store for the coming year”.

Last year (August 2019) Cashcalc withdrew its transfer value comparator tool due to low demand amid a shrinking pension transfer advice market.

The provider introduced the TVC in October in response to new rules from the Financial Conduct Authority, which had made it a requirement for defined benefit transfers.

But almost a year later the tool accounted for only 2 per cent of CashCalc's usage but was taking over 50 per cent of the development team's time in maintaining it.

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