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The July Budget: salary sacrifice

In the run-up to the Budget, there was some concern that the chancellor might ‘call time’ on the use of salary sacrifice in employee benefits provision.

This was not mentioned in the Budget speech itself, but the following paragraph does appear in the supporting HM Treasury Summer Budget 2015 document:

“Salary sacrifice arrangement can allow some employees and employers to reduce the income tax and National Insurance that they pay on remuneration. They are becoming increasingly popular and the cost to the taxpayer is rising. The government will actively monitor the growth of these schemes and their effect on tax receipts.”

So the concerns would appear to be valid, albeit there is clearly no appetite to change this at the moment.

That said, the most significant use of salary sacrifice is around pension contributions, and the entire system of pension tax reliefs may be subject to change in the not-too-distant future anyway.

For the moment, however, salary sacrifice (and indeed pension tax reliefs) remain unchanged for most.



Lenders expect mortgage rates to fall further

Lenders expect mortgage rates to fall further in the coming three months, especially for landlords. The Bank of England’s quarterly Credit Conditions Review shows lenders expect a “slight” reduction in prime residential rates and a “significant” reduction in buy-to-let rates in the third quarter. However, the report adds: “In recent discussions, most major UK lenders […]


BoE’s Carney says base rate rise is ‘moving closer’

Mark Carney has said that a UK interest rate hike is nearing, when speaking to the new Treasury Select Committee.  The governor of the Bank of England told the committee that “the point at which interest rates may begin to rise is moving closer, given the performance of the economy”. He later added: “The point […]


Lauren Bagley to leave mortgage club TMA

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AA to enter UK mortgage market

The AA’s financial services arm has signed a 10-year deal with Bank of Ireland UK and plans to enter the mortgage market next year. AA Financial Services, a division of automotive breakdown organisation the AA, and BoI UK confirmed the arrangement yesterday and plan to launch a new AA-branded mortgage product in the second quarter […]


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