Lowes Magazine Issue 118

Allowances

nces ts (ISA)

INSIDE TRACK 2021-2022 VAT

limit

£20,000

Standard rate

accounts 31.11.2019 18-40 saving to purchase

£9,000 £200pm

2021-2022 However, VAT is reduced from 20% to 5% on leisure and hospitality between 15.07.2020 and 30.09.2021. From 01.10.2021 to 31.03.2022 the reduced rate will increase to 12.5%. Corporation Tax

COMMENT

£4,000 stor can receive a government bonus of 25% per year. s par t of the overall annual allowance.

Think ISA IT MAY SEEM COUNTER-INTUITIVE TO BE TALKING about putting money into an ISA straight after the end of the tax year but it can make more sense than waiting another year to invest. By investing now the ISA can start to benefit from 12 months additional market exposure that can add up to a considerable difference in returns over the years. This is particularly so where markets are recovering and the money would otherwise be held in a cash account, paying a pittance in interest with returns largely eroded by inflation. It can also establish a good habit, which hopefully can be maintained year-on-year. 2020-2021 2021-2022 0% £0 - £5,000 £0 - £5,000 20% £0 - £37,500 £0 - £37,700 40% £37,501 - £150,000 £37,701 - £150,000 45% Over £150,000 Over £150,000 7.5% Over the £2,000 Over the £2,000 dividend allowance dividend allowance 32.5% Over the £2,000 Over the £2,000 dividend allowance dividend allowance 38.1% Over the £2,000 Over the £2,000 dividend allowance dividend allowance 20% £0 - £1,000 £0 - £1,000 45% £1,001+ 2020-2021 2021-2022 £12,500 £12,570 £1,000 £1,000 £500 £500 £2,000 £2,000 £1,000 £1,000 £1,000 £1,000 £9,075 £9,125 £3,510 £3,530 £2,500 £2,520 £1,250 £1,260

20%

Main and small profit rate

Tax tables WE ARE PLEASED TO BE ABLE to provide our annual Tax Tables booklet with this issue of the magazine. If you would like further copies to pass on to family, friends or colleagues, please call 0191 281 8811 or email Contact@Lowes.co.uk £200,000 £2,000,000 2021-2022 £21.15 per week £14.00 per week £96.35 per week First 6 weeks then Company car charges based on CO2 emissions: Electric, Hybrid, Petrol & Diesel: % of list price CO2 emissions (g/km) 1 Electric range figure (miles) 0 NA 1 1-50 >130 2 1-50 70-129 5 1-50 40-69 8 8 1-50 30-39 12 12 1-50 <30 14 14 Electric & Hybrid: >51g/km: +1% for each additional 1g/km Petrol & Diesel: 51-54 - 15 15 55-59 - 16 16 60-64 - 17 17 65-69 - 18 18 70-74 - 19 19 75 - 20 20 76-79 - 20 20 Petrol & Diesel: >80g/km: +1%, to a maximum of 37%, for each additional 1g/km Diesel cars: Add 4% to the ‘% of list price’ up to a maximum of 37%. 1 For cars in the 1-50/km of the CO2 emissions band, the ‘electric range figure’ determines the appropriate percentage. The electric range figure in miles is the equivalent number of kilometres specified in an EC cer tificate of conformity, as being the maximum distance for which the car can be driven in electric mode without recharging the battery. NB: The taxable benefit is the relevant rate multiplied by the list price of the car.

2021-2022

eme 3

19%

Threat and opportunity horizons IN LESS THAN EIGHTEEN MONTHS THE WORLD WENT FROM identifying a new virus, to implementing a global immunisation programme. There are of course many things that could have been done better and many lives that could have been saved, but the overall achievement has been phenomenal and led many to ask what else can we do? Whilst the possibilities are endless, and many pioneers are driving forward, the next worldwide effort is again, likely to be in response to a threat. Beyond pandemics, threats to humanity, or at least modern civilization, are numerate. Environmental threats are aplenty; whilst there has been a long focus on air pollution and the destruction of rainforests, more airtime of late has been afforded to the impact of plastic pollution and the choking of the oceans. Plastic micro particles have been found in every living creature, even at the deepest part of the ocean, in rain samples from across the globe and even in the snow falling in the Arctic. I fear this situation will get a lot worse before it gets better, and the long-term implications are unknown. For another significant threat we need to look up. Being on a rock hurtling through space comes with its own external risks, not least from other rocks but our technological advances are creating their own dangers. In the sixty years we have been sending things into space, we’ve done a pretty poor job of keeping our orbit clean. NASA estimates that there are over 520,000 pieces of debris at least the size of a bullet hurtling around the Earth at speeds of up to 17,500 mph. With 1,000 new satellites being launched each year, Earth’s orbit is becoming an increasingly busy and dangerous place. Not only does each piece of space junk have the potential to do immense damage to, or even destroy an operational satellite, or spacecraft, the chain reaction risk known as Kessler Syndrome, as highlighted in the 2013 movie Gravity, is an ever-present threat. In the extreme, such an outcome a few years from now could spell disaster for civilization as we know it, crippling internet technologies, bringing global transport to a standstill and sending us back decades, overnight. Thankfully, with threats also come opportunities. Avoiding the serious threats to our planet is starting to attract investment and could become very big business, very soon, as we start to make initial inroads into cleaning up our own backyard – inner and outer atmosphere. Hopefully, we have seen the last of pandemics in our lifetimes and will not witness anything worse. As immunisation programmes take effect, so the world is beginning to recover. We can expect that healthcare, environmental and related industries will see raised profiles over the next few years. What else can we do? Innovative thinking is achieving new milestones. After 50-odd missions to Mars over the years, a large proportion of which were lost for one reason or another, we have now witnessed humanity deploy the first aircraft on our nearest neighbouring planet and many of us will live to witness the first manned missions there, potentially within the decade. Science fiction is becoming science fact. Part of our role as Independent Financial Advisers is to spot the opportunities these situations present for our clients. That said, out-with the Lowes Changing World Portfolio, which has a heavy technology bias, our investment philosophy is not exceptionally adventurous, seeking instead to achieve reasonable returns without exposing the capital to undue risk.

Income Tax (England, Wales and NI) Rate Star ting rate 1

£100,000 eceived on qualifying VCT investments are exempt from 1 million is invested in knowledge-intensive companies.

Basic rate Higher rate

2021-2022 2022-2025

Additional rate

Basic rate on dividends

2

2

Higher rate on dividends

5

Additional (and Trust 2 ) rate on dividends

Fernwood House · Jesmond Newcastle upon Tyne · NE2 1TL Tel: 0191 281 8811 www.Lowes.co.uk Email: enquiry@Lowes.co.uk

Trust standard rate

Trust rate

£1,001+ 1 For savings income only. Non-savings income represents the first slice of income for the purposes of the above. 2 Trusts do not benefit from the £2,000 dividend allowance and dividends received within the £1,000 standard rate will be taxed at 7.5% and 38.1% above the standard rate. Personal Allowances

d Paternity (ShPP) & Adoption (SAP)

Grid n°100019821 medium Sudoku We hope you enjoy this mind teaser – our latest Sudoku puzzle. To complete the puzzle fill the grid so that each row, column and 3x3 block contains the numbers 1 to 9. The solution to the puzzle can be found on page 15. It’s also having someone regularly reviewing their finances to ensure they stay on track. Someone with their best interests at heart. Why people choose advice A RECENT SURVEY FOR THE ASSURER CANADA Life by financial services research company AKG, revealed three main reasons people seek financial advice. These were: 1 Peace of mind provided by their relationship with an adviser 2 Access to ongoing support 3 Ideas on finances/savings/investments. We see the order of priority in the answers as telling and reflecting a fundamental truth about financial advice. People seek advice not so much to know which investments to put money into, although, of course, that is a core function of the service, but rather to have confidence that their finances are being looked after professionally at all levels and across all areas. It’s knowing not just that their money is working hard for them in the right investment, pension or savings vehicles, but the knowledge that they have access to the experience and expertise of a professional in dealing with complicated areas like tax, passing on wealth, and planning for needs in retirement and later life. This enables people to have a clearer picture of their financial affairs and to plan for the future.

average weekly earnings

Personal allowance 1 Personal savings allowance – basic rate taxpayer 2 Personal savings allowance

revious tax year, you can recover 92% ax month. If Class 1 NICs are less than er 103% of the total of all payments.

– higher rate taxpayer 2 Dividend allowance 2 Proper ty Allowance 3 Trading Allowance 3 Married/civil par tner allowance 4 Married/civil par tner basic allowance

Tax Tables 2021 - 2022

Blind person’s allowance

Transferable personal allowance for

spouse/civil par tners 5 1 Reduced by £1 for every £2 over £100,000. 2 These bands are taxed at 0% and form par t of an individual’s basic/higher rate limits. 3 Where gross proper ty income and/or gross trading income is in excess of these amounts, recipients can choose to take the £1,000 allowance as a deduction against their gross income instead of deducting actual expenses to arrive at their taxable income figure. 4 For those born before 6/4/1935. This is reduced by £1 for every £2 of income over £30,400. 5 Transferred between spouses/civil par tners provided neither suffer tax over basic rate tax and are not in receipt of married couple’s allowance.

E&OA

Child Trusts Funds ACCORDING TO REPORTS, there are around 200,000 Child Trusts Funds set up for children when they were younger (between 2002 and 2011), which have yet to be claimed by those who have attained age 18. As each, on average, is worth £2,000, that’s a considerable £400

Secure email

LOWES HAS INTRODUCED A NEW EMAIL SYSTEM FOR clients which uses military-grade encryption to help keep communications between us and our clients secure. There has been a reported increase in cybercrime during the pandemic, as criminals have taken advantage of individual’s greater use of online services. Once criminals have access to emails they can commit identity theft and attempt fraud. Our new system allows us to send you emails that are secure from hackers. You will be able to read and send secure emails to Lowes using the portal. How it works: The emails are encrypted in transit and can only be read within the Egress portal. You will need to use your email address to register for the portal the first time you receive a secure email. Subsequently, you will log into the portal when you wish to communicate with Lowes securely: Lowes.co.uk/securemail

million unclaimed. At a time when many young people are struggling financially, having been

furloughed or made redundant, £2,000 could be a useful monetary boost.

Individuals can find out where their Child Trust Fund is by filling in a form on the HMRC website (gov.uk/child-trust-funds/ find-a-child-trust-fund) .

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Make your money work. Best bank & building society rates Type Amount Provider Account

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8

Follow us for company updates

Gross Rate

Contact

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Unrestricted instant access accounts Online £1 - £500,000

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@LowesFinancial

Paragon

Limited Edition Easy Access

0.41% www.paragonbank.co.uk

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Fixed rate bonds Online £1,000 - £85,000 Ahli United Bank UK (Raisin)

2

Lowes Financial Management

1 year Fixed Term Deposit

0.65%

www.raisin.co.uk

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This is for one simple reason – history tells us that nothing runs smoothly all the time, there can be unexpected events, unintended consequences and everything we do – including dealing with a pandemic, space exploration and investing in the stockmarkets – requires careful risk assessment and long-term thinking and horizons. Ian H Lowes, Managing Director

Online

£1,000 - £85,000

QIB UK (Raisin)

2 years Fixed Term Deposit

0.80% *

www.raisin.co.uk

2

9

Online £1,000 - £1 million

BLME

2 Year Premier Deposit Account

0.80% *

www.blme.com

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1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9

1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 8 5 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 7 1 2 3 4 5 6 7 8 9 9 1 2 3 4 5 6 7 8 9

Online £1,000 - £250,000

Zopa

3 years Fixed Term Savings

0.91%

www.zopa.com

* This is the Expected Profit Rate (EPR). Measures of inflation - The average change in prices of goods and services over a 12 month period to February 2021 Retail Prices Index (RPI) 1.4% Consumer Prices Index (CPI) 0.4%

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Covershot: Ingenuity Mars Helicopter in Flight (Artist’s Concept) NASA/JPL-Caltech

Sources: Providers’ websites, Office for National Statistics, www.thisismoney.co.uk, www.moneysupermarket.com, www.moneyfacts.co.uk 12/04/2021. All accounts subject to terms and conditions.

1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9

1 2 3 4 5 6 7 8 9

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Source: www.printmysudoku.com

A number may not appear twice in the same row or in the same column or in any of the nine 3x3 subregions.

2 LOWES Issue 118 · Published April 2021 The content of the articles featured in this publication for your general information and use only and is not intended to address your particular requirements. Articles should not be relied upon in their entirety and shall not be deemed to be, or constitute, advice. Although endeavours have been made to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough examination of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of any articles. Thresholds, percentage rates and tax legislation may change in subsequent Finance Acts. Levels and bases of, and reliefs from, taxation are subject to change and their value can go down as well as up and you may get back less than you invested. Past performance is not a reliable indicator of future results.

If you would like to receive further information on any of the subjects featured in this issue please call: 0191 281 8811 , fax: 0191 281 8365 , e-mail: client@Lowes.co.uk , or write to us at: Freepost LOWES FINANCIAL MANAGEMENT . Lowes ® Financial Management Limited. Registered in England No: 1115681. Authorised and Regulated by the Financial Conduct Authority.

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