As the UK gears up for tomorrow’s budget, we take a look at what could possibly be included and what this could mean for UK dentistry.
Iain Stevenson, head of dental at Wesleyan Financial Services, said: ‘When it comes to dentists’ finances, key things that we’ll be looking out for in the budget are policies that help them save and invest more, build clear retirement plans and anything that helps them run more profitable, resilient practices.’
Tax and retirement
On tax and retirement, Iain said: ‘There is some speculation that the chancellor could unveil further cuts to National Insurance. This would give savers welcome money back in their pockets at a time when the cost of living is still high. However, if the cuts still focused on employee rates only, it wouldn’t benefit dental practice businesses.
‘There have also been suggestions that the budget could bring an increase to the State Pension age.
‘That would undoubtedly cause some alarm and would force affected dentists to revisit their retirement strategies to make sure that they could meet any resulting funding shortfalls, and to factor-in the implications for any NHS Pension Scheme benefits they hold.
‘In the 2015 NHS Pension Scheme, “normal retirement age” is tied directly to the State Pension age. Increasing the latter could mean dentists need to wait longer to access the former, penalty-free.’
Inheritance tax (IHT)
‘The other rumour that is resurfacing is that Inheritance Tax could be reduced or even removed,’ Ian said.
‘This is no longer a tax purely for the wealthy. More and more people are being dragged into scope, and continued uncertainty around what will happen to it means people are deferring important decisions about how to pass on their money, which could have negative outcomes.
‘We’re hoping to see some clarity around intentions to help put speculation to rest.’
On business support measures and the need for consistency
Ian added: ‘In the current environment, dentists would also welcome any measures that reduced their Corporation Tax bill and further incentivised business investment, so they can expand and diversify their service provision.
‘Whatever the chancellor announces on budget day, building policies based on consensus will be important.
‘We’ve already seen the uncertainty that’s been caused by the abolition of the lifetime allowance (LTA) – consistency and certainty is the bedrock of good financial planning, and we must avoid anything that only brings more complexity and confusion.’
Stay tuned as more information on the Spring budget is released tomorrow (6 March).
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