Did you know that the Government plans to add 1.25% on the dividend tax rate. You can receive £2,000 of dividends a year tax free but after that the tax rate is 7.5% for basic taxpayers and 32.5% for higher taxpayers. This is planned to rise to 8.75% and 33.75% respectively in April 2022. This means a basic taxpayer will pay £263 in tax, up from £225 on £5,000 of dividend payments. For a higher taxpayer this will e £1,013 up from £875.
The age at which pension savers can access their pot freely, is set to increase from 55 to 57. The change, which is due to come into force in 2028, will affect most people approaching retirement. This will mean that from 2028, those under 57 will not be able to access their pensions without incurring a tax penalty. There are exceptions, however, notably people forced into retirement by bad health as well as firefighters, police and the armed forces.