Courtiers Wealth Management
Courtiers Wealth Management

News & Insights

Spring Budget Response

15 Mar 2023

Response from Rikki Doré, Private Client Manager and Mark Lovett, Adviser

As far as Courtiers’ clients are concerned, the big news from today’s Spring Budget was on pensions. Completely abolishing the Pension Lifetime Allowance (LTA) will be welcome news for clients wishing to boost their pension. This was much more radical than the increase from £1,073,100 to £1.8m that was widely expected and might also encourage some who were about to retire because of the tax charge for exceeding the limit to continue working. It could even attract some retired people back into the workforce. Raising the Annual Allowance from £40,000 to £60,000 will mean that clients can ring fence more into their pensions and when combined with the abolishment of the LTA will mean that individuals are able to pass on a greater legacy to their beneficiaries outside of IHT.

Money Purchase Annual Allowance (MPAA)

Raising the MPAA from its current level of £4,000 to £10,000 is again a positive for our clients. Those who have previously taken income from a pension may now decide to return to work maybe part-time and this will allow them to continue to contribute to a pension.

Maintaining the Energy Price Guarantee at £2,500 for the average household is good news for the majority of clients.

Tax cuts

Anyone looking for tax cuts will have been disappointed. As previously announced, inheritance tax (IHT) thresholds and income tax basic rate and higher rate allowances will as expected continue to be frozen and the threshold for the 45% additional rate of tax cut from £150,000 to £125,140. With inflation in January running at 10.1%, the impact of what’s called fiscal drag will pull millions of people into paying more tax. Freezing IHT thresholds highlights the importance of making full use of your gifting allowances.

Capital Gains Tax

Halving the Annual Exempt Amount to £6,000 from April and again to £3,000 in April 2024 highlights the need to use the rest of this tax year to ‘crystalise’ any gains up to the allowance and going forward to consider transfer of assets between partners to potentially double tax-free gains.

Dividend Allowance

Halving Dividend Allowance to £1,000 from 6 April and halving it again at the start of the 2024-25 tax year illustrates the value of stocks and shares ISAs, where income is tax free.


Response from Sagar Dholiwar, Head of Corporate Clients

No change in the proposed Corporation tax increase from 19% to 25%, although companies will be able to deduct the investment costs of new qualifying technology, plant and machinery against taxable profits.

A bombshell announcement in the world of pensions with the current Lifetime Allowance (LTA) of £1.07m not just increasing to a generous £1.8m as expected but being completely removed.

This will be a huge tax saving for those with significant pension benefits at retirement. The LTA removal along with the increase in the Annual Allowance (from £40,000 to £60,000 per annum), provides companies and higher earners a great opportunity to boost individual and workplace pensions.

Pension restrictions over the last decade have made contributions unattractive for certain employee cohorts (in particular for Senior NHS clinicians), expediting the retirement of a skilled workforce and much to the detriment of our National Health Service. The Chancellor was keen to reverse this trend by dangling a contribution carrot to encourage people to work for longer and tempt back those already retired.

Although great news for higher earners and generous employers, it feels like another missed opportunity to encourage positive pension planning for the majority, who really do need greater support with making pension contributions.

It will be interesting to see what the Chancellor has up his sleeve at the Autumn Statement as he will be laying out details about the benefits of investment in high growth firms being available to more investors and the measures to unlock productive investment from Defined Contribution Pension funds.


Response from Gary Reynolds, Chief Investment Officer

Ex-Governor of the Bank of England Mervyn King frequently warns against taking economic forecast too seriously. So, I wouldn’t be overly confident in the Chancellor’s prediction that the UK economy will shrink by -0.2% this year and then grow by 1.8% and 2.5% in 2024 and 2025 respectively. I am particularly suspicious of the Office for Budget Responsibility’s (OBR) forecast cited by the Chancellor in his statement that inflation will drop to 2.9% by the end of this year. The “base effect” (i.e. dropping from previous highs) may help but I suspect that the Bank of England will have a fight on its hands getting UK inflation consistently below 3% anytime soon. I don’t think the Budget did anything spectacular for the economy although measures to get retired people back to work should help.



This communication is for information purposes only and should not be relied upon in making an investment decision. The views expressed by individuals and the business are based on market conditions at the date of issue and are subject to change without notice. The mention of any stocks or shares should not be taken as recommendation to deal and does not take into account the individual investor’s investment objective or risk profile. Where an investment or security is denominated in a different currency to the investor’s currency of reference, changes in rates of exchange may have an adverse effect on the value, price or income of or from that investment to the investor. Any third-party sites, or pages which are linked to the document, have not been reviewed by us and therefore we accept no responsibility for the authors or content of external link or pages. If you are interested in any of Courtiers Asset Management Limited’s range of funds, or require any financial advice, please speak to a financial adviser.

The Investment Team response is issued by Courtiers Asset Management Limited, CAM0323735. Courtiers Asset Management Limited is Authorised and Regulated by the Financial Conduct Authority – Register No: 616322. Address: 18 Hart Street, Henley on Thames, Oxfordshire RG9 2AU. Tel: 01491 578368.

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