What are the key financial dates to consider?

With inflation rising and speculation of interest rate rises to compensate, households are likely to see a significant jump in their monthly outgoings over the coming year. For investors, the rise in inflation has the potential to devalue their assets, particularly any cash balances. Added to this, there will also be a number of legal changes over the year that will affect both investors and borrowers.

With all of this arriving on the back of the complications caused by the pandemic, it will be more important than ever to keep on top of your finances in 2022. To help investors and borrowers stay ahead this year, we have outlined the key financial dates and deadlines to make the most of your financial planning for the year ahead.

first-time investors

January 1st: Inheritance Tax rules change

At the beginning of the year, HMRC changed its rules for estates with no inheritance tax to pay, meaning full accounts no longer need to be submitted when the deceased was domiciled in the UK.

Any investors reviewing their estate planning this year will want to consider how to pass on their estate to loved ones in a controlled, tax efficient and straight forward way in light of this change.

February 3rd: Bank of England interest rate meeting

All eyes will be on the Bank of England this February to see what move they make to tackle soaring inflation, which is now at over 5%. In December 2021, the Bank of England raised the Bank Rate to 0.25% and it seems likely that in February a further rise will be needed. This will have ramifications for borrowers, savers and investors alike. Seeking advice on how to weather the current inflation rise should be high on any investor’s list for 2022.

February 28th: Extended online self-assessment tax return deadline

The deadline by which you must file your tax return online has been extended by one month for this year. This will affect anyone who is self-employed or needs to declare any income not taxed at source, such as from a rental property or dividends. As taxpayers who miss the deadline can face an immediate £100 fine, and a further £10 daily penalty for up to 90 days after the deadline, this extension will be welcome for those who have been disrupted by the effects of the pandemic this winter.

April 5th: End of the tax year

The end of the tax year will be a key date for investors looking to take advantage of their tax efficient savings allowances. Over the financial year, investors can contribute a maximum of £40,000 for pensions and £20,000 for ISAs before incurring a tax charge. Those wishing to use their allowance should make these arrangements, or contact their financial advisor, sooner rather than later to avoid missing the deadline.

April 6th: National Insurance increase

From 6 April National Insurance contributions will increase by 1.25%. This rise will affect those who are employed and self-employed, but will not apply to those over the State Pension age. Workers are likely to pay hundreds of pounds, with a maximum of £700, more in National Insurance contributions due to the change, so households should plan their finances carefully for the coming tax year. 

April 6th: State Pension rise

The beginning of the new tax year also sees in a State Pension rise of 3.1%. However, due to the suspension of the “triple lock” for the coming tax year, this increase is not in line with the most recent cost of living figure that sits at 5.1%. This gap could see pensioners being hundreds of pounds a year worse off in real terms, making effective retirement planning even more important to weather this deficit.

November: Autumn Budget

The Autumn Budget usually takes place at the end of October or the beginning of November. With the rise in the cost of living, National Insurance and interest rates, coupled with the removal of the “triple lock”, investors approaching retirement will have their eyes on this year’s autumn Budget to assess their financial position in coming tax year.

December: Mortgage guarantee scheme ends

Since April 2021 the Government has guaranteed 95% mortgages with selected lenders in a bid to jump-start the first-time buyer market following lockdown. The knock-on effect of the scheme was to encourage the wider banking industry to lend to borrowers with smaller deposits. However, with the mortgage guarantee scheme due to end in December 2022, access to high percentage mortgages will likely reduce again. First-time buyers will want to consider the options available to them before this deadline. For further information, take a look at our recent article on the current options for first-time buyers looking to get on the property ladder.

Keeping in mind key financial dates 2022

With the pressures from rises in inflation, tax, and household outgoings, the coming year could prove a rocky road for investors and borrowers alike. As such, keeping key financial dates in mind alongside prompt and detailed financial planning should be a priority for 2022 to make the most of your investments, while weathering the changes to come.

PLEASE ALWAYS REMEMBER: Grosvenor Wealth Management Ltd is authorised and regulated by the Financial Conduct Authority. The value of investment can go down as well as up and you may not get back the original amount you invested. Tax treatment is dependent on individual circumstances and may be subject to change. Tax planning is not regulated by the Financial Conduct Authority. Your mortgage is a loan secured against your property. Your home may be repossessed if you do not keep up repayments on a mortgage or other loans secured on it.

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