Important pension protection lost by many working couples
Families across the UK could be missing out on millions of pounds of additional pension income as they fail to realise the connection between claiming child benefit and protecting their state pension record.
In January 2013 the Government introduced the High-Income Child Benefit Tax Charge, which saw a tax charge incurred if a parent receives child benefit, but is earning £50,000 per year or more.
This charge increases on a sliding scale until earnings pass £60,000, at which point the value of the child benefit is equal to the charge being levied.
Many high-income couples no longer bother to claim child benefit as a result, but they may be missing out on an integral pension protection.
It would seem that there is no point claiming for a credit only for it to be taxed, but the rules also allow partners to get credits towards their state pension, even if they don’t receive the child benefit.
To assist taxpayers the Government has even included the option to allow couples to defer the child benefit payment but accept the National Insurance credits.
Couples who have chosen to opt out of the child benefit system are therefore being reminded to check their current situation to ensure they maintain the state pension protection afforded to them.
In today’s complicated marketplace, professional and impartial advice is paramount when it comes to finding the best solutions to meet your financial needs and avoid becoming a victim of a scam.
MT Financial Management is a firm of Chartered Financial Planners that provides independent and unbiased financial planning, investment portfolio management, pension review and trust review services to the clients of Moore Thompson Chartered Accountants and selected professional introducers.
We offer an initial meeting at our cost and with no obligation so that you can decide whether you wish to use our services before incurring any costs.
We will agree a fixed fee to provide a review of your ‘ current financial situation so that our experienced and independent financial advisors can determine whether your financial arrangements are appropriate, and recommend areas that need improvement. Of course, our proposals will be comprehensively explained, so that you can make informed decisions about any suggested changes.
All of our advisors are qualified to Chartered Financial Planner status, providing their high levels of technical knowledge and experience on a fixed cost basis.
As our fees are agreed in advance, we are not tied to promoting particular solutions and can focus on providing the best professional advice.
To find out more about our services, please contact Trevor Wilshire on 01775 717220 or visit www.mtfinman.co.uk