Round Up Autumn 2018

6 threesixty hot topics Here we explore the most common technical and compliance queries that come up during business risk visits, as well as those raised to our helpdesks. Technical issues can be found on the left, whilst those regarding compliance can be found on the right. This section is only intended as a quick reference. Again, full support and details are available on our website. Basic rules – qualifying for the residence nil rate band An estate will be entitled to the additional threshold if: -- The person dies on or after 6 April 2017. -- The person owns a home, or a share of one, so it’s included in their estate. -- Their direct descendants, such as children or grandchildren, inherit the home, or a share of it. For estates valued at more than £2 million, the additional threshold (and any transferred additional threshold) will be gradually withdrawn or tapered away. An estate may also be entitled to the additional threshold when an individual has downsized to a less valuable home, or sold or given away their home after 7 July 2015. Flexible ISA rules A flexible ISA allows the saver to withdraw cash and replace it during the same tax year without reducing the current year’s allowance. They can also withdraw cash from previous tax years. Withdrawals can be made from a cash ISA or any cash held in a stocks and shares or Innovative Finance ISA (including from the sale of investments) provided the ISA Manager has adopted the ‘Flexible ISA’ rules. Offering flexibility is optional for ISA managers, but this flexibility is not available for Junior ISAs or Lifetime ISAs. Where a Help to Buy ISA is operated under flexible terms and conditions, replacement subscriptions cannot exceed the monthly Help to Buy limits. Flexible ISA withdrawals are taken initially from the current year’s subscriptions, and then from the previous year funds depending on the amount to be withdrawn. When the withdrawn cash is repaid to the ISA, it replaces the subscriptions from previous years before those from the current year. The ‘one ISA of each type per tax year’ rule continues to apply. Where a flexible ISA has current year subscriptions only, any subsequent subscriptions in the same tax year will first replace the cash that has been withdrawn, and any withdrawals over and above the amount subscribed, for example, income or capital growth - can only be replaced in that ISA. Always check with the ISA provider as they may have minimum investment requirements to ensure the ISA remains open. The lifetime allowance currently stands at £1,030,000. However, one very important but sometimes forgotten consideration is death in service (DIS). When assessing the value of pension benefits for your clients in relation to the lifetime allowance, don’t forget the value of a registered DIS plan must be included and this may well increase annually in line with salary increase. Where lump sum death benefits are provided by an excepted or relevant life policy, these benefits won’t form part of the individual’s lifetime allowance. Death in service and the lifetime allowance