John Glencross: What lies behind the rise in tax-efficient investment levels?

EIS and VCTs increasingly on investors’ radar

clock • 6 min read

John Glencross looks at the reasons - most notably the scaling back of pension tax relief over recent years - why EIS and VCTs are appearing on the radar of an increasing number of investors

Pensions are not what they used to be - certainly not for high-earners and those who have accrued large funds anyway. Over the past five or six years, successive governments have cut back the tax relief paid out - some £50bn a year currently - as they have tried to reduce the budget deficit. This began in the 2011/12 tax year, when the annual allowance was cut from £255,000 to £50,000 - an amount that has since been trimmed to £40,000. More recently a complicated tapering system has been imposed on those earning more than £150,000, which means those at the upper end of the system's scale...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Tax planning

'Christmas has come early for the government' – IHT receipts rise

'Christmas has come early for the government' – IHT receipts rise

Budget tax changes and rising take highlight advice value, experts say

Jen Frost
clock 20 December 2024 • 2 min read
No more IHT relief on pensions: How to maximise alternative tax-efficient vehicles

No more IHT relief on pensions: How to maximise alternative tax-efficient vehicles

In the light of the government’s latest Budget

Jordan Wheatley
clock 19 December 2024 • 5 min read
Changes to agricultural and business relief explained

Changes to agricultural and business relief explained

Government will publish a technical consultation in early 2025

Julia Peake
clock 11 December 2024 • 4 min read