OpinionMar 17 2023

Poking around the Budget to find the devil in the detail

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Poking around the Budget to find the devil in the detail
Chancellor Jeremy Hunt's Budget is a tax break for the wealthy and a wish for the workforce. (FT Fotoware)

Budget burnout? I've covered more fiscal statements than chancellor Jeremy Hunt and I still get as excited as the deputy speaker every time it rolls around.

For journalists it is a chance to really pick through the detail of the devil - I mean, find the tax devil in the detail, sorry Jeremy - and work out who the winners and losers might be. 

It is why I still insist on having a paper copy put under my nose for me to pore through with my varifocals, highlighting and post-it- sticking and generally shouting out across the newsdesk things such as: "Has anyone looked at the plans for gilt issuance?" while they're all busy filing copy. 

Mostly, fiscal statements are full of the usual tax Tetris of shuffling around fuel duty or VAT on goods and services but, as with busses, you wait long enough and three juicy pensions changes come along at once. 

It seems some people are on Sunseekers and the rest of us are clinging, like Rose DeWitt Bukater, to a floating door.

We already knew, because the Budget now has more leaks than a parliamentary WhatsApp group, that there would be movement on the lifetime allowance, the annual allowance and the money purchase annual allowance. 

What we did not know was that from April 2024, the LTA would be abolished completely. That caused some excitement on the newsdesk - I think I actually put CAPS LOCK on when I was posting furiously on the live blog and on Twitter.

Or maybe that was about the potholes. Pensions and potholes - that's basically a general election vote-winning combo. 

As ever, the devil is in the detail - and HM Revenue & Customs has had to step in and confirm that people who were advised to take out fixed and enhanced protection against breaching the LTA will not be penalised if they decide to heed Hunt's call to arms, return to work and end up being enrolled back into a workplace pension.

Initially, as FTAdviser reported earlier today, it seemed those with enhanced or fixed protection risked losing their protection – and therefore their higher tax-free cash – if they broke the protection rules by paying more into their pension.

This would have effectively stopped them from being able to benefit from the removal of tax limits.

Thankfully, this potential pitfall has been filled in more quickly than those potholes that the government has pledged to spend millions on fixing. 

Certainly advisers will be furiously busy over the coming months.