Autumn Budget 2024

After the Chancellor, Rachel Reeves, delivered the new Labour government’s first Budget, our Savings and Retirement Sales Director at LV=, Gwen Haggo, has shared her thoughts on what it means for both Inheritance and Capital Gains Tax. 

Changes to Inheritance Tax

Gwen Haggo, Savings and Retirement Sales Director at LV=, said:

"The large rise in the value of housing and other assets over the past 10 years means inheritance tax is potentially a problem for a small but growing number of estates, when it was once only an issue for the very wealthy.

“Including pensions as part of an individual’s estate will contribute to more people paying 40% inheritance tax on anything above the nil rate band of £325,000.

"This policy will have dynamic consequences for the market, largely depending on the detail of any modifications to inheritance tax, alongside other changes.

“Carefully made financial plans using pensions as an IHT shelter will need to be reviewed.

“What we might now see is more use of bond and trust activity as an alternative IHT planning strategy."

Increase to the Capital Gains Tax (CGT) rate

Gwen Haggo, Savings and Retirement Sales Director at LV=, said:

“Those who have already maximised their pension and ISA allowances and may have considered direct investment in other assets like property or collectives may now look at alternatives.

“Our latest Wealth and Wellbeing research shows one third (31%) of UK adults with a savings and/or investment plan say they will review their investment strategy if there is a change to Capital Gains Tax (CGT), highlighting how this will impact many people with savings and investments.

“Investment bonds could look increasingly attractive as these are not subject to CGT, but rather taxed under the chargeable events regime.

“In addition, actively managed funds, as opposed to Managed Portfolio Services (MPS), can now present a more attractive prospect to customers as they are able to adapt to these changes swiftly by diversifying their portfolios and targeting lower capital gains sectors.

“LV’s own Smoothed Managed products provide access to a range of actively managed risk rated funds within a long-term insurance contract and enables the investor to switch between funds without any CGT implications.”

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About LV=

LV= is a leading financial mutual and serves over 1.16 million members with a range of financial products. When we started in 1843 our goal was to give financial security to more than just a privileged few and for many decades we were most commonly associated with providing a method of saving to people of modest means. Today we follow a similar purpose, helping people to protect and provide for the things they love, although on a much larger scale and through a wide range of financial services including insurance, investment and retirement products. We offer our services direct to consumers, as well as through IFAs. 

LV= and Liverpool Victoria are registered trademarks of Liverpool Victoria Financial Services Limited (LVFS) and trading styles of the LV= Group of Companies. Liverpool Victoria Financial Services Limited, registered in England with registration number 12383237 is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, register number 110035. Registered address: County Gates, Bournemouth, BH1 2NF.