Channel Islands facing demographic ticking time bomb, says report
The analysis compares the Channel Islands with New Zealand, which it said was a leader in workforce inclusion.It said achieving employment rates similar to New Zealand could increase the Channel Islands' workforce by an additional 7,500 employees.Guernsey had the potential to raise more in tax than Jersey as there were more people not in the workforce than could be.
The report said employment rates reflected "high rates of early retirement and the extent to which women either delay returning or go back to work part-time after having children".To combat the issue, it was suggested governments could make childcare more affordable and enhance education provisions.It added employers could make jobs more flexible and embrace an older workforce while islanders could adopt a mindset of lifelong learning.
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Fashion United
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The Independent
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Times
an hour ago
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Savers with pensions worth less than £90,000 should be able to pass on their pots free from inheritance and income tax to spare grieving families the confusion of complex rules, the government has been told. From April 2027 most retirement pots and death benefits will be included in someone's estate for the purpose of calculating inheritance tax (IHT), leaving more families facing hefty tax bills of up to 40 per cent. The change will close a loophole that gives savers a uniquely tax-efficient way of passing on wealth to the next generation — those who can afford it can use other assets to live off in retirement, leaving their pension savings untouched to be passed on inheritance tax-free when they die. But critics have warned that bringing pensions into the IHT net will put a significant administrative strain on grieving relatives. 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Under Reeves's plans, those pension pots will become part of your estate, removing a valuable tax perk. You will still be able to leave a pot IHT-free pot to a spouse or civil partner, but they will not in turn be able to leave it to your children without them having to pay tax on it. One proposal from the Investing and Saving Alliance and the consultancy Oxford Economics is to keep the IHT exemption on inherited pension pots but to only protect those worth less than £90,000 from income tax, regardless of when the pension holder died. If, however, the beneficiary was a dependent of the deceased they would be able to make withdrawals from the pot over time, allowing them to manage the income so they paid less tax. If they were not a dependent, they would have to take the full value as a lump sum. A second proposal is for a tax on inherited pension pots above a certain threshold, with no exemption for spouses or civil partners, which could prove unpopular. The Alliance and Oxford Economics suggested three scenarios that they said would raise the same amount: an inheritance tax of 25 per cent on the value of pots above £150,000; a charge of 30 per cent on values above £200,000; or 35 per cent on values above £250,000. They said that each proposal would raise about £1.3 billion in their first year and £2 billion a year after that. The government estimates that its plan will raise £1.46 billion a year by 2029-30. The Office for Budget Responsibility predicts that IHT receipts, including those from pensions, will rise to £14.3 billion by 2029-30, up from £7.5 billion in 2023-24. The Times understands that the Alliance submitted the second proposal to HM Revenue & Customs during its IHT consultation with the pensions industry between October and January. Renny Biggins from the Alliance said: 'The government's proposal to include pension funds within IHT risks creating unnecessary stress and delays for grieving families, and causing long-term behavioural change among consumers that we don't yet fully understand, particularly around pension contribution levels and withdrawals. 'We show that the government's fiscal and policy goals can still be met without creating additional issues and concerns for people at the worst possible time.' • Why a wealth tax won't work When IHT on pensions is introduced it is expected that pension schemes will have to liaise with the executors of an estate to calculate and pay any IHT due on savings pots. Meanwhile the clock will tick on the six-month deadline in which IHT must be paid to avoid interest being charged on overdue payments. Rachel Vahey from the investment platform AJ Bell said: 'Of the hundreds of replies to the consultation, many in the industry we have spoken to have shared one central message — the IHT proposals are simply unworkable and have the potential to wreak havoc for grieving families. 'There are better solutions out there that don't cause confusion and high costs for executors and beneficiaries, mean swifter payment of benefits to loved ones and tax to HMRC. These solutions would ultimately make it easier for clients to plan how to spend their pension pot and make sure that their loved ones also have enough money to live on.' The Treasury said: 'We continue to incentivise pension savings for their intended purpose — of funding retirement instead of them being openly used as a vehicle to transfer wealth — and more than 90 per cent of estates each year will continue to pay no inheritance tax after these and other changes.'
