Parents shouldn't have to pay tax on their children's savings – here's how to avoid a bill
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
North Wales Live
24 minutes ago
- North Wales Live
DWP pension changes that could mean people retire later
Sweeping changes to both state and private pensions, overseen by the Department for Work and Pensions (DWP), have been announced. The modifications form part of extensive reforms to the pensions sector by the Labour government. Among the most significant alterations is the prospect of a substantial rise in the state pension age, which could force people to postpone their retirement. Last week, the government revealed a wide-ranging review of the UK pensions system. An independent commission has been formed to examine a series of controversial matters and put forward recommendations for reform. The Government plans to increase the State Pension age from 66 to 67 between 2026 and 2028, affecting those born on or after 6 April 1960. For money-saving tips, sign up to our Money newsletter here. There are proposals for a further rise, lifting the State Pension age from 67 to 68 between 2044 and 2046, though this timeline could be brought forward, reports Birmingham Live. "A faster increase is definitely on the cards," says Rachel Vahey, the head of public policy at investment platform AJ Bell. Sign up for the North Wales Live newsletter sent twice daily to your inbox The Institute for Fiscal Studies thinktank caused a stir when it suggested that the State Pension Age may need to climb to 69 by 2049 and 74 by 2069 if the triple lock safeguarding its value remains in place. Australian employers are presently obliged to pay 11.5% of workers' salaries into their pensions, with this figure set to rise to 12% in 2025. In comparison, whilst the overall minimum contribution in the UK sits at 8%, employers need only provide 3%. Pension firms and sector specialists have repeatedly lobbied for this amount to be raised to 12%. Nigel Peaple, director of policy and advocacy at the Pensions and Lifetime Savings Association, has continually maintained the minimum pension contribution should rise from the current 8% of earnings to 12%. He said: "To minimise the impact on savers and employers, the increases should happen gradually, as they did in Australia, with employers paying more so that, by about 10 years from now, both employers and employees would pay the same. "This approach of a 50/50 split between employers and employees would strike a fair balance; it would involve higher contributions for employers compared to the current UK rules but much lower ones than traditional UK pensions in which the employer usually paid around two thirds of the cost." One concept attracting attention is the "sidecar savings" method. There are different ways to structure a "sidecar account". Two proposed models are the dual account and integrated plan frameworks. Within the dual account structure, the worker keeps a workplace pension whilst simultaneously joining a separate savings account via a savings provider. The saver sets a savings ceiling for the sidecar account, and the savings provider directs the employer to contribute to this sidecar until the limit is reached. Once the threshold is achieved, any extra funds are channelled into the pension alongside the standard pension contributions. Should funds be withdrawn from the sidecar, the individual recommences saving into it until the cap is attained once more. In the in-plan model, employees opt to save via their employer. Employers then remit the total sum contributed by an employee to both a workplace pension and an emergency savings account to a pension provider. The pension provider allocates the contribution between the pension pot and the emergency savings account. Nikhil Rathi, chief executive of the UK's Financial Conduct Authority, remarked: "Australia, New Zealand, the US, Singapore and South Africa all permit citizens to leverage their pension savings to buy a first home. "Some have suggested we consider, carefully, similar approaches in some circumstances here in the UK." This week, the government announced its dedication to "committed to both monitoring and narrowing" the gender pensions gap. Recent Department for Work and Pensions (DWP) figures have revealed that the gender pension gap has escalated to a "stark" 48%. The figures, unveiled as the government declared a 'revival' of the Pensions Commission amid concerns about undersaving, showed that in 2020 to 2022, women aged 55 to 59 had a median wealth of £81,000 compared to £156,000 for men. Approximately 20% of self-employed individuals are contributing to a private pension, with many pointing to the Lifetime ISA as a potential solution. There's talk that ministers may tweak the rules to let over-40s open a Lifetime ISA and boost its appeal by cutting the 25% withdrawal charge. Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, commented: "The 25% government bonus acts in the same way as basic-rate tax relief, and any income can be taken tax-free." She added, "There is also the ability to access money early if needed, subject to a 25% exit charge."
The Independent
24 minutes ago
- The Independent
Massive offshore wind farm approved by Scottish Government
An offshore wind farm which developers say could be the world's biggest has been approved by the Scottish Government. Berwick Bank – proposed to be built off the coast of East Lothian – aims to deliver 4.1 gigawatts (GW) of capacity, which is believed to be enough to power every home in Scotland twice over and around 17% of the homes in the UK. The development will feature up to 307 turbines and have two connection points to the grid – one in Dunbar, East Lothian, and another in Blyth, Northumberland. Deputy First Minister Kate Forbes welcomed the approval, saying the Government had given the application 'extremely careful consideration'. She said: 'The decision to grant consent to Berwick Bank is a major step in Scotland's progress towards achieving net zero and tackling the climate crisis, as well as supporting national energy security and growing our green economy. 'It is also an important decision for Scotland's renewables sector, and this investment will be further built upon through the delivery of Scotland's significant future pipeline of offshore wind projects under the ScotWind and the Innovation and Targeted Oil and Gas leasing rounds. 'We will continue to work closely with the developer and key stakeholders, including those working in fishing and conservation – to minimise the impact of the development on the marine environment and other marine users – and balance the needs of people and nature.' Developers SSE Renewables will have to provide a plan to counter any impact the wind farm may have on seabirds to be approved by ministers. UK Energy Secretary Ed Miliband said the announcement means there have been enough wind farms approved in the UK to meet the Government's ambition of delivering clean power by 2030. 'We welcome this decision, which puts us within touching distance of our offshore wind targets to deliver clean power by 2030 – boosting our mission to make Britain a clean energy superpower,' he said. 'We need to take back control of our energy and more offshore wind getting the green light marks a huge step forward in Britain's energy security and getting bills down for good. 'But we know there's a lot more work to do and we must go further and faster to get us off the rollercoaster of fossil fuels and make working people better off with clean, homegrown, secure power as part of our Plan for Change.' The UK Government aims to have between 43 and 50GW of energy capacity in offshore wind by the end of the decade, with 15.9GW currently online and a further 28GW having received consent. Stephen Wheeler, the managing director of SSE Renewables, said news of the approval is 'hugely welcome'. He added: 'At over 4GW of potential capacity, Berwick Bank can play a pivotal role in meeting the mission of Clean Power 2030 for the UK and achieving Scotland's decarbonisation and climate action goals. 'Berwick Bank has the potential to rapidly scale-up Scotland's operational renewable energy capacity and can accelerate the delivery of homegrown, affordable and secure clean energy to UK consumers from Scottish offshore wind, helping meet the UK's clean power ambition by 2030.'
The Independent
24 minutes ago
- The Independent
Home sales jumped by 13% month-on-month in June, HMRC figures show
House sales jumped by 13% month-on-month in June, according to HM Revenue and Customs (HMRC) figures. Across the UK, it estimated that 93,530 home sales took place during the month, which was 1% higher than in June 2024. The report said the numbers 'reflect transactions recovering from the dip seen' following the ending of the temporary stamp duty thresholds. Stamp duty applies in England and Northern Ireland. Previous figures have indicated a rush of buyers completing sales before the stamp duty holiday ended. Nick Leeming, chairman of estate agency Jackson-Stops, said: 'While the surge in activity seen in March is unlikely to be repeated, the market remains steady for now, with completions progressing at a healthy pace, though regional variations continue to influence transaction timelines and completions. 'The full market picture is one that points to both an increase in demand as well as supply, with an upward trend of agreed sales likely to be reflected in figures in the coming months as mortgage affordability loosens. 'Across the Jackson-Stops network, our national figures show the mid to high end market remained steady in June, particularly across historically rich, well-connected market towns like Bury St Edmunds, Chichester and Colchester. 'We are seeing a seasonal uptick of prime country homes launch to market, reflecting sustained buyer appetite for areas that blend heritage with accessibility. 'Similarly, high completion levels in Colchester, Hale, Northampton and Sevenoaks highlight the continued demand for lifestyle-led, commuter-friendly areas.' Nathan Emerson, chief executive officer of property professionals' body Propertymark, said: 'It is extremely positive to see an uplift in the number of housing transactions for June 2025. 'Overall, the housing market is starting to see progression, especially following the recent upheaval of the stamp duty threshold changes.' Tony Hall, head of business development at Saffron for Intermediaries, said: 'With markets anticipating that the Bank of England will make two further interest rate cuts before the end of 2025, there are reasons to stay optimistic through the next few months. 'Steady buyer activity combined with anticipated rate cuts suggest a positive outlook heading towards the autumn.'
