Not a Budget for savers and investors!

That’s the conclusion of Taunton’s private investors’ group, held at the Taunton and Tiverton Golf Club on Monday.

Following last Wednesday’s Autumn Budget, Rachel Reeves’s pronouncements have left private investors reeling and revising their plans.

ISAs and Self-Invested Personal Pensions (SIPPs) are popular vehicles on which most savers and investors rely.

The group was relieved that ISAs remain untouched, enabling savers to build up savings (already taxed through earnings) free of income and capital gains tax.

But that’s not the case with SIPPs.

These are pension savings that the government ostensibly encourages people to take up.

They have until now been passed on death free of inheritance tax (IHT).

Not any more, it seems, and the changes have SIPP holders scrambling to change their retirement plans.

SIPPs are now to be taxed as part of the holder’s estate, using up part of the Nil Rate Band (NRB), the tax-free allowance.

So, savings paid into these private pensions, over many years in most cases, in the belief that they could be drawn down, or passed to the next generation tax-free, is shattered.

This has come as a bombshell to those with substantial savings in their pension pots.

The result: members plan to run-drawn down these funds earlier than planned and are discouraged from making future savings into these private pensions.

Further disquiet was expressed over the treatment of farmers and business owners whose assets are now to be subject to a 20 per cent inheritance tax (IHT) charge above a basic rate of £1mn.

For business owners, it removes the incentive to build their business.

Likewise, small-scale farmers.

When a single tractor can cost a quarter of the basic £1mn allowance, farmers are in shock.

Small farms rely on subsidies to break even, most make little by way of profits, so how will the next generation ever raise enough money to pay IHT liabilities?

The conclusion of the group: coupled with the other measures announced by Ms Reeves affecting business, this is not a Budget for economic growth.

Anyone interested in joining a local savings and investing discussion group – part of the SIGnet national network - contact tom.entwistle@gmail.com.

Thanks,

Tom Entwistle