Why the pension death tax could destroy thousands of family businesses
The move by the chancellor, Rachel Reeves, to charge death tax on pensions could force the liquidation of businesses, jeopardising jobs and the broader economy, according to the wealth manager Evelyn Partners. It said that about 15,000 businesses are at risk.
From April 2027 unspent pension assets will be subject to inheritance tax and, crucially, pension schemes will have to settle their share of the tax bill within six months of the pension holder's death.
This shift, which was revealed in the autumn budget, will hit business owners who have held commercial property — such as company premises, workshops or machinery — within their self-invested personal pensions (Sipps) or small self-administered schemes.
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Telegraph
17 minutes ago
- Telegraph
Investors can't trust Labour, warns UK bond giant
Investors can no longer trust Labour after its multiple about-turns, bond giant Legal & General (L&G) has warned. Sonja Laud, the chief investment officer at L&G, said the decision to abandon key benefit reforms and reverse course on winter fuel payments had destroyed faith in the Government's economic plans. L&G is one of Britain's biggest investors, managing £1.1 trillion of assets. It is one of the biggest buyers of UK government debt. Ms Laud said: '[Markets] can't trust that what's been put forward will be put in place. You will see the adverse reaction. It was quite a big one yesterday.' It follows a dramatic day in which Rachel Reeves's tears in the House of Commons triggered a fall in the pound and a jump in borrowing costs. Investors were concerned that the Chancellor could be on the brink of leaving Downing Street, sparking fears that her fiscal rules could be abandoned. However, borrowing costs had been rising even before the Chancellor wept after Sir Keir Starmer gutted his welfare reforms on Tuesday night to avoid an embarrassing defeat on the legislation. The about-turn has blown a £5bn hole in Ms Reeves's budget. Ms Laud said: 'The changes we have seen ever since the first announcements from the Labour Party - and the intended changes they wanted to put forward - have subsequently been either watered down or changed. 'That's what the bond market does not like. The reaction in the gilt market yesterday [shows] that there clearly is an unwillingness to accept that lack of clarity.' 'Flashback to days of Liz Truss' She added that traders were still nervous after Liz Truss's mini-Budget. She said: 'There's heightened sensitivity in the UK because of what happened in 2022, where you had unfunded fiscal promises.' Ms Laud's comments come as Sir Keir and Ms Reeves scramble to repair the damage done this week. The Chancellor made a surprise appearance alongside the Prime Minister at an event on Thursday, at which she insisted she remained committed to her fiscal rules. The Prime Minister also said Ms Reeves would remain Chancellor 'for many years to come'. Borrowing costs dipped in response but remain higher than where they were just days ago. David Roberts, at Nedgroup Investments, said the bond market turmoil was a 'flashback to the days of Liz Truss'. 'Having been elected on a mandate to sort out public finances, to rein in benefit spending, it appears many in the [Labour] party have decided to return to their traditional tax and spend ideology,' he said. 'Failure to push through welfare reform whilst adhering to fiscal rules seems to leave the Government with little option other than to raise taxes.' Morgan Stanley warned that the struggling Chancellor could be as much as £30bn in the red against her fiscal rules ahead of the autumn Budget. With limited room to borrow or cut spending, 'tax hikes look most likely,' the bank said. Sir Keir's failure to grasp the nettle of welfare reform means Britain will spend £1.5bn a week on health and disability benefits for working-age adults by the end of the decade. The bill is on course to balloon to £75.7bn by 2029-30, up by one quarter from £60.4bn this year. It puts the cost of this portion of the welfare state on a par with the defence budget.
Daily Mail
18 minutes ago
- Daily Mail
Meet the billionaire American beauty lighting up Wimbledon: Emma Navarro hates talk of her family's money... and she's looking for love!
In a welcome boost for tennis stars, Wimbledon announced a record prize pot of $73million for this year's tournament - with singles champions set to take home a cool $4.1million. The sum represents an increase on the $3.6m taken home by last year's champions but, for one star, the Wimbledon title would prove far more significant than the stunning prize money. US star Emma Navarro, who was raised in New York, boasts a personal fortune so vast that the tournament's prize money would be like short change to her. Emma is the daughter of wealthy American billionaire investment tycoon, Ben Navarro, and the tennis star is quietly sitting on a $3.8bn inheritance. Tycoon Ben, 62, married to Emma's mother Kelly, built his billionaire empire thanks to numerous business ventures, most notably being the founder and owner of Sherman Financial Group, which has assets such as Credit One Bank. Despite her affluent background, Navarro has put the work in on the court and, now, has hit back at detractors who claim she was 'handed things' on her way to the top. In an interview with Tatler, Navarro explained: 'I don't read anything. I don't read the comments, the articles, any of that stuff. I don't know what the fans are saying. 'There will be headlines and they kind of mention that [her father's billionaire status] which is fine, but I didn't grow up being handed things. 'We grew up in a sort of traditional way. We'd get up at 6am on a Saturday morning and go play tennis. 'Growing up it was a priority that we learnt toughness and we learnt work ethic and how to be intentional and purposeful and live productive lives so I don't love being referred to as whoever with however much money's daughter. It's a label I don't really like.' For now, tennis is Navarro's only focus as she gears up for a third round match at Wimbledon on Friday afternoon. However, the 24-year-old did admit that, though she is currently single, she's open to love and wouldn't rule out dating a fellow professional. She continued: 'Tennis is it, for now. We'll see. My heart's open, let's put it that way.' When asked specifically whether she'd date another pro, Navarro replied: 'I don't know - I wouldn't write it off. It happens a lot. There are a few tennis couples on tour.' On Wednesday, tennis lovebirds Stefanos Tsitsipas and Paula Badosa reportedly parted ways once again - after both crashing out of Wimbledon in the first round. The duo are said to have broken up peaceably but have been 'shattered' by the demands of their high-powered careers, including injuries. Meanwhile, Navarro's rise followed a career best run of Grand Slam results having reached the third and fourth round respectively at the Australian and French Opens, before reaching the last eight at SW19 last year. Her run to the quarter-finals at Wimbledon included a stunning win over Coco Gauff, before she was beaten by the eventual tournament runner-up Jasmine Paolini. This year, Navarro has got the better of Petra Kvitova and Veronika Kudermetova already, as she prepares for a third round match on Friday. Navarro's best Grand Slam performance, however, came later in the year when she reached the US Open semi-finals in front of a home crowd but fell to the eventual champion Ayrna Sabalenka in straight sets. A quarter-final run at this year's Australian Open and a first WTA 500 title in Mexico in March have seen Navarro's own personal winnings from the sport reach $4.6m (£3.4m). Navarro had previously ground her way through the challenging US college tennis circuit before turning pro and the American has not been afraid to take on rivals on the court when she has felt the need. She generated headlines during last year's Olympic Games in Paris after being embroiled in a post-match spat with Chinese star Zheng Qinwen. After losing in three sets to the Zheng in the third round of the women's singles event, Navarro grasped her opponents hand during the handshake and had a tense exchange with the Chinese star. Navarro was seen shaking her head after exchanging words with Zheng, who would ultimately go on to claim the Olympic title. In her post-match comments, Navarro did not pull any punches about her view of Zheng, accusing her of being 'cut-throat' and added she was a player she doesn't respect. 'I think she goes about things in a pretty cut-throat way,' Navarro said. 'It makes for a locker room that doesn't have a lot of camaraderie, so it's tough to face an opponent like that, who I really don't respect. 'But, kudos to her, she played some good tennis there at the end. She played better than me, so congrats to her.' When asked about Navarro's comments, Zheng responded: 'She told me she doesn't know how I have a lot of fans. 'It looks like she's not happy with my behaviour toward her. If she's not happy about my behaviour, she can come and tell me. I would like to correct it to become a better player and a better person.' In a perceived dig at Navarro, Zheng then added: 'I'm glad that she told me that, I will not consider it an attack because she lost the match.' Navarro and Zheng has yet to meet since, with the pair narrowly avoiding a showdown at the US Open when the Chinese star was beaten in the quarter-finals by Sabalenka. With Navarro addressing the media prior to Zheng and Sablanenka's match, she was again asked about her comments at the Olympics and doubled down on her forthright opinion of her rival. 'I don't want to go super into the weeds with it, but I think during that match and, you know, on the practice court and the last few times I've played her, I felt just a little bit disrespected by her' Navarro said. 'I think she didn't necessarily treat me or the sport with respect. That's why I said what I said after the match. But, yeah, that's it. She added: 'I haven't spoken to her since and no, I didn't surprise myself, I felt that way the whole match. 'Even if I had won, I probably would have said the same thing. It wasn't a sort of in the moment, emotional thing. It was kind of just how I felt. And I think it got a lot more attention than I thought it was going to. 'I think maybe it's just one person's opinion, but it wasn't an emotional outburst. It was kind of just matter of fact, how I felt.' With fans awaiting the next meeting between the pair, all eyes will be on the Wimbledon draw to see when Zheng and Navarro could potential clash. A meeting would undoubtedly be high-profile due to the pair being seeded fifth and ninth respectively, meaning a showdown would be in the latter stages of the tournament. Zheng recently fell foul of British fans at Queen's when she overcame Emma Raducanu, after the Chinese star opted to change her shoes when the home favourite was attempting to save a break point, prompting boos from spectators. The competitive spirit shown by Navarro has run through her family, as her grandfather was ex-Ivy League footballer turned coach Frank Navarro. He was widely heralded for his work at America's most prestigious colleges including Princeton and Columbia. Frank served as a head coach for Williams College, Columbia University, Wabash College and Princeton University and even introduced the 'Monster Defence' at Williams. Navarro has offered fans glimpses at her life on and off the court through her Instagram, with her following having soared after impressive results over the past year and a half on tour. After heading into last year's Wimbledon with a following of 40,000, there are now over 240,000 tracking her life and progress. Navarro's account is dedicated mostly to the sport she loves, with the odd glimpse into a more luxe life via shots of boutiques and her jet-set life on the Women's tennis tour. There's also plenty of photos of the family pets, including Marti, a shaggy haired black and white dog that seems to hold a special place in Emma's heart. Although the American will be hoping to impress again at Wimbledon, there's certainly no financial pressure firing her on; the impressive family purse means she could retire in luxury tomorrow if she wanted to. Ben has also showed interest in his daughter's passion, investing in the tennis world first purchasing Charlestown Tennis LLC through his Beemok Sports company on 2018 - which holds the longest-running women-only tennis tournament, the Charlestown Open. Before splashing out nearly $300milliion (£237m) in 2022 to obtain the Western and Southern Open, which is a major tennis tournament. The Western and Southern Open saw 19 of the top 20 tennis players compete at the competition back in 2022 and is one of only nine tennis events that is recognised globally as a top-tier tournament for both men and women players. Regardless of her result at Wimbledon, Navarro already has a financial security most players can only dream of before their playing days come to a close.
The Independent
25 minutes ago
- The Independent
For crying out loud: are you ready for the ‘politics of pain' about to hit us?
Keir Starmer promised that the last Budget would be 'painful'. In a speech in the Downing Street garden in August, two months earlier, he tried to manage expectations, saying that the state of the public finances was 'worse than we ever imagined', and asked people to 'accept short-term pain for long-term good'. It was a forlorn hope. Far from 'accepting' the pain, public opinion turned against the government further after Rachel Reeves announced £25bn a year of tax increases, rising to £40bn a year by the end of this parliament. Business leaders reacted particularly badly to the rise in employers' national insurance contributions, causing the chancellor to over-correct when she addressed the CBI the following month. She told representatives that she was 'not coming back with more borrowing or more taxes'. Oops. That was too categorical, and she immediately had to clarify: 'I do not plan to have another Budget like this. I have wiped the slate clean.' Within a few weeks, however, it turned out that it was a magic slate, which had filled up with new liabilities that would have to be paid for. Donald Trump had become president, threatening a global trade war and depressing economic forecasts. By the spring statement in March, the thin buffer between sticking to her fiscal rules and breaking them had disappeared, and she announced emergency cuts to welfare spending to restore it. Those cuts were reversed by the Labour rebellion in parliament this week, leaving more money to be found in the Budget this autumn. 'Of course, there is a cost to the welfare changes that parliament voted through this week,' Reeves said in a round of TV interviews to show a brave face after her tears in the Commons yesterday, 'and that will be reflected in the Budget.' It has been clear for months now that taxes will have to rise further. But now it is becoming obvious that the tax rises will have to be substantial. Ben Zaranko of the Institute for Fiscal Studies said yesterday: 'It's not hard to imagine a world where they are of a ballpark similar scale to last autumn. If you have the perfect storm of economic forecasts being downgraded, additional spending commitments because these reforms haven't got through parliament, and the world is in a gloomier place generally, you could comfortably be into double-figure billions even before you talk about any retail offers. A £20, £30, £40bn Budget is not what the government would want, but it's not impossible by any means.' Needless to say, this is a political disaster. Mixing her metaphors, Reeves claimed last year not just to have wiped the slate clean but to have fixed the foundations. Now she is going to have to report that the problem of subsidence has not in fact been solved and that further work on the foundations is needed. Last year, Starmer was accused by the commentators, including me, of overdoing the gloom. Reeves was accused of depressing the economy by talking it down. Now it turns out that neither of them was gloomy enough. But where they have still failed is in setting out what the eventual reward for all this pain might be. When Margaret Thatcher administered her monetarist medicine in 1979-81, many economists thought she had overdone it and caused unnecessary hardship, but her aim was clear: to squeeze inflation out of the system by weakening the trade unions and stimulating the supply side. I never liked her rhetoric of strength through suffering. In 1980, she compared herself to a nurse looking after an ill patient: 'Which is the better nurse? The one who smothers the patient with sympathy … Or the nurse who says, 'Now, come on. Shake out of it.' … Which is the one most likely to get results? The one who says, 'Come on, you can do it.' That's me.' But when the economy picked up in 1982-83, enough of the voters felt that the hard times had been worth it. That was why Starmer, Reeves and Wes Streeting launched the 10-year NHS plan today. It was designed to sell the message that the pain of tax rises will be worth it if the health service can be made to work again. A functioning NHS is Labour's equivalent of 1982's economic recovery. But we have had the pain, and although the NHS may have stopped getting worse, it is still some way off getting better, and now Reeves is indeed coming back for more tax rises – and on a scale that makes it hard for her to avoid hurting people on middle incomes. Starmer and Reeves have been unlucky to take power with the public finances in a uniquely dreadful state. They ruled out tax rises so that they could win the election, then had to put taxes up. They said that this was a one-off fix to 'restore stability', but now they are coming back for more. Reeves's tears in the Commons were an unfortunate image, and it is unfair on her, but it is an image that sums up the government's predicament all too well.
