Podcast Summary
LinkedIn is a top platform for hiring professionals, especially those not actively job searching.: Small businesses can find quality candidates on LinkedIn who might not be looking elsewhere for jobs, but the recent changes to capital gains tax could make employee share schemes less attractive for small companies.
LinkedIn is an essential platform for small businesses looking to hire professionals. It's where you can find candidates who might not be actively searching for a new job but could be open to the right opportunity. In fact, over 70% of LinkedIn users don't visit other leading job sites in a given month. So, if you're in the market for new hires, make sure to post your job on LinkedIn. Another topic discussed on the FT Money Show was the impact of recent changes to capital gains tax on employee share schemes, specifically the Enterprise Management Incentive (EMI) scheme. This scheme, which is popular among small companies, allows employees to buy shares in their company with favorable tax treatment. However, with the recent changes, employees will now be subject to the same 18% capital gains tax rate as business owners. This could make it more difficult for small companies to compete for talent with larger firms, as the attractiveness of share option schemes has diminished.
Reducing Capital Gains Tax through allowances and transfers: Individuals can minimize CGT by utilizing annual tax-free allowance, offsetting losses, and transferring assets to tax-efficient wrappers like ISAs and SIPs. Farmers face higher tax rates due to loss of indexation allowance from April 2023.
Individuals can reduce or even avoid Capital Gains Tax (CGT) by utilizing various allowances and transferring assets to tax-efficient wrappers such as ISAs and SIPs. For private investors, being aware of the annual tax-free allowance and offsetting losses against gains are essential strategies. Moreover, spousal transfers and moving assets to a lower-taxed individual can also be beneficial. However, farmers are an unusual target of the CGT increase, as they have disproportionately benefited from indexation allowance due to the underperformance of farmland compared to other assets. From April, they will lose this allowance and face a higher tax rate on larger taxable gains, potentially leading to a surge in farm sales or asset transfers within families. Overall, managing CGT effectively requires ongoing attention and utilizing available allowances and transfer options.
Commercial Property Prices Fall for First Time in 15 Years: Commercial property prices are predicted to fall by 20% next year, potentially causing significant losses for investors in commercial property funds. This downturn could also impact the residential property market due to high levels of leverage.
The commercial property market is experiencing a significant downturn, with prices falling for the first time in 15 years. This trend is expected to continue into next year, with predictions of a 20% fall in commercial property prices. This could result in significant losses for investors in commercial property funds, and there are concerns that this downturn could also impact the residential property market due to the high levels of leverage in the market. While it remains to be seen if this is just a temporary blip or a more serious economic issue, investors with exposure to both commercial and residential property should be prepared for potential losses.
Southeast England's Residential Property Market May Be Less Affected by Tax Changes: Investors in residential property, especially long-term holders, should consider selling due to upcoming capital gains tax changes. The RDR in the UK financial advice sector may impact high-street advice.
The residential property market in the Southeast of England may be less affected by tax changes and market slowdown compared to other regions due to supply restrictions. However, investors in residential property, especially those who have held it for several years, may want to consider taking profits due to upcoming changes in capital gains tax. Open-ended property funds could face potential issues if there's a rush for redemptions, but it would take a significant event for this to happen. In the UK financial advice sector, the Retail Distribution Review (RDR) aims to make advice more independent and transparent, with advisers receiving fees instead of commissions. The consultation period for RDR ends this year, and it remains to be seen how this will impact high-street financial advice.
Retail Distribution Review: Better-equipped advisers: The RDR aims to enhance financial advice by requiring advisers to be degree-level qualified and fee-based, leading to improved planning, unbiased advice, and a wider range of investment options.
The retail distribution review aims to improve the financial advice industry by requiring advisers to be professionally qualified with advanced qualifications, equivalent to a degree level, and be fee-based rather than commission-driven. This shift towards professional qualifications and fee-based remuneration will result in better-equipped advisers providing more holistic financial planning and unbiased advice. Additionally, it may lead to advisers recommending a wider range of investments and moving away from product sales towards discretionary investment management. Ultimately, these changes should result in customers receiving more appropriate financial advice and better management of their wealth.
Shifting towards professional financial advice with fees: Mortgage rates are more competitive, but fewer options exist, making the choice between fixed and variable rates crucial based on future interest rate predictions.
The financial advice industry is undergoing significant changes towards becoming more expert-driven and professional, with the Regulatory Reform (RDR) requirements being met by some firms, while others are expected to catch up soon. This shift towards professional advice will come with fees. In the world of mortgages, there's both good and bad news. The good news is that mortgage rates are becoming more competitive, with fixed and variable rates being similar. However, the bad news is that there are fewer mortgage options available, with over 40% fewer mortgages on the market, and almost 20% fewer in the prime market. Some good deals do exist, such as a 2-year fixed rate of 5.58% from Abbey with a high fee, and a 5-year fix of 5.64% from National Counties. Ultimately, the decision between fixed and variable rates depends on one's predictions for future interest rates.
Maximizing Opportunities: Securing Good Deals: Secure good deals for peace of mind, whether through affordable meal options at Kroger or budget-friendly fitness solutions at Planet Fitness. Consider value and benefits, and make informed decisions to maximize savings.
Key takeaway from this week's FT Money Show is the importance of securing good deals when they present themselves, particularly in areas such as investments or memberships. The speakers emphasized the value of peace of mind that comes with making the most of opportunities, whether it's through shopping at Kroger for affordable and inspiring meal options or joining Planet Fitness for budget-friendly fitness solutions. At Kroger, customers can find over 30,000 options for their meals and enjoy everyday low prices, as well as additional savings through digital coupons and fuel points. Meanwhile, Planet Fitness offers energy-boosting workouts without the pressure to upgrade memberships or pay extra fees. It's essential to consider the value and benefits of various deals and make informed decisions that align with your budget and needs. By doing so, you can maximize your savings and enjoy the peace of mind that comes with making the most of available opportunities. Remember, you can always reach out to FT Money Show with your thoughts and questions, and they will be back next week with more financial insights. In the meantime, consider exploring the offerings from Kroger and Planet Fitness to see how they can enhance your lifestyle while keeping your budget in check.
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