Spring Budget 2023 - Corinthian

16 March 2023

Here are some of the highlights which may affect you:

Changes to Pensions

The Lifetime Allowance (the total amount of money you are allowed to have in your pension without having additional tax charges – which is currently just over £1m) the charge is being removed from 6 April 2023
However, the maximum amount of tax free cash you can take will be 25% of your fund value or the current LTA (whichever is the lower), so maximum is frozen at £268,275
The Annual Allowance (the maximum total contribution that can be paid in during the year) will be increased from £40,000 to £60,000 from 6 April 2023
Also, the Money Purchase Annual Allowance (potentially applicable if you’ve started taking pension income from a defined contribution pension) will be increased from £4,000 to £10,000

Fuel Tax

Government subsidies limiting typical household energy bills to £2,500 a year
extended for three months, until the end of June (typically saving £160 per household)
End to energy premium for prepayment meters, bringing them into line with prices for customers paying by direct debit
affects 4 million households and saving £45 a year from July

Childcare help

30 hours of free childcare for every child between 9 months to 3 years of age with working parents by September 2025 in a bid to help them work more (to be phased in starting with 15 hours for, 2 year olds from April 2024 and 9 months olds from September 2024)
Families on universal credit to receive childcare support up front instead of in arrears, with the £646 per month per child cap, increasing to £951.
£600 “incentive payments” for those becoming childminders, and relaxed rules to let childminders look after more children

Additional changes that may affect you and your money

Fuel duty frozen, the 5p cut to fuel duty on petrol and diesel, due to end in April, kept for another year
From August, alcohol taxes in pubs to be 11p in the pound lower than the rate in supermarkets
And the last good news for today is the outlook for inflation. It is expected to be 2.9% by the end of 2023 compared to 10.1% at present.

If you’re unsure about how the pension or tax changes might impact you, feel free to
contact our Corinthian Benefits team. We are always ready to help and can offer guidance
and support tailored to you.