Advisers have faced a challenging end to the tax year on April 5, following the Covid-19 pandemic, which has caused uncertainty and led to a different working approach.
Ian Lowes, managing director of Lowes Financial Management told FTAdviser that work throughout this period was “more challenging than usual”.
“Obviously the pandemic is still having an impact on every part of life. In terms of processing, we are having to allow more time because we are working from home – this includes providers and platforms – not just us,” he said.
The tax year which ended on April 5 usually creates a multitude of work for advisers with pension and Isa allowances being a focus of clients' concerns.
In March this year, self-invested personal pension provider Curtis Banks called for the government to extend any end of tax year deadlines after receiving calls from worried advisers.
However, no extension was offered, despite differing working conditions and a greater variance in the type enquiries for advisers.
“It was anticipated that there would be a significant hike [in the Budget] in capital gains tax but that hasn’t occurred, and there was no change in the pension tax relief either,” Lowes said.
At that time, investors breathed a sigh of relief as a predicted hike in capital gains tax did not materialise in the Budget.
Chancellor Rishi Sunak had been predicted to raise the 20 per cent rate to bring it more in line with income tax rates, but while both the CGT annual exemption and the IHT thresholds were frozen until 2026, no further action was taken on either.
Lowes added that Easter came at an awkward time of year for many, which “caught people out” but with a “brilliantly benign budget” some of the pressure was off advisers, he said.
Darren Dicks, head of wealth management at Age Partnership, said the Covid-19 pandemic had meant another “hard year” following on from the Brexit uncertainty faced in the tax year from 2018-19, with many clients deferring their pensions.
“Clients who would previously have chosen to retire earlier than state pension age have been deferring, mainly due to economic uncertainties but furlough has also played a part. Why would clients choose to retire when they’re currently on furlough!”
Dicks added the lack of opportunity and choice to go on holiday, see friends and family as another large factor in clients’ decisions to defer.
Despite tough conditions for advisers, Dicks noted there had been a marked change at Age Partnership since February when the vaccination programme kicked off.
“Clients are now much more optimistic about their future and feel more in control of making big financial decisions about their retirement,” he said.
Stephanie Pickering, independent financial adviser at Verity Wealth Management, told FTAdviser that the end of this tax year had been much busier for several reasons.
Pickering said: “Normally the end of the tax year is quite relaxed for us as we have generally already completed any necessary Bed and Isa, capital gains tax and pension funding exercises with plenty time to spare.