EQ weekly roundup 4-7-18
This week’s roundup includes news that more than a million couples are missing out on a tax break, a “glaring” gender pension gap for women taking career breaks, proposals to introduce a minimal rental tenancy and fears over a drop in cash machines across the country.
This week’s roundup includes news that more than a million couples are missing out on a tax break, a ‘glaring’ gender pension gap for women taking career breaks, proposals to introduce a minimal rental tenancy and fears over a drop-in cash machines across the country.
A million couples ‘missing out on tax break’
More than a million married and civil partnered couples are eligible for a tax break but are yet to claim it.
This is according to new data from HM Revenue & Customs, which said the Marriage Allowance is worth up to £238 a year, but backdated payments of up to £662 could also be available.
So far, around three million couples have successfully applied for the allowance, but critics have claimed the allowance – aimed at couples with one major source of income – was not easy to claim.
Despite this, Financial Secretary to the Treasury Mel Stride said the allowance is a ‘really important tax relief’. She added: ‘I’d urge those that haven’t yet managed to claim the money to do so right away.’
Women facing a ‘glaring gender pension gap’
Women are facing a ‘glaring’ gender pension gap, primarily brought on by career breaks to raise children and lower pay. This is according to Fidelity International, which claimed young women in their late 20s or early 30s face an 11% smaller pension pot than men by the time they retire.
Data published by the investment company revealed that, using predictions and allowing for the rising cost of living, a typical 25 to 34-year-old woman’s pension pot would be worth £126,784 by the time she reaches the state pension age of 68. However, a male could expect a pension pot of £142,836.
The investment company said women face this penalty because of the pressures of motherhood and caring commitments. For many women in their 20s, pensions have fallen down the list of priorities as they face up to more pressing financial concerns, such as the cost of renting or buying a home.
Maike Currie, Fidelity International’s Investment Director, told BBC News: ‘A lack of time, confidence, access to the right information, industry jargon and not knowing where to start are just some of the obstacles that stop many women from thinking that investment is for them.’
Government proposes longer rental tenancies
A minimum rental term of three years could be introduced under government proposals to give renters in England more security.
According to official government data, 80% of tenants currently have contracts of up to six or 12 months, but ministers have said longer agreements would allow them to enjoy longer periods in their property before having to move out. What’s more, the government has claimed that tenants would be allowed to leave their contracts earlier under the plans, despite the minimum term, and landlords would get more financial security.
Government figures show that renters stay in a property for an average of four years, but most have shorter contracts.
Polly Neate, Chief Executive of housing charity Shelter, said loss of tenancy was ‘the main driver of homelessness’, and called for the government to ’go beyond three years’.
Row over cash machines intensifies
The debate over the future of ATMs in the UK has intensified ahead of a cut in the fee operators receive from banks. From Sunday, the fee paid each time a cash machine is used will be reduced, and further restrictions are due each year until 2021.
Link, which oversees cash machines across the country, has argued that the move is essential for the sustainability of the network. However, consumer group Which? has said that 300 ATMs are closing each month, leading to inconvenience for consumers.
The changes will see the fee paid to operators, known as the interchange rate, being reduced from 25p to 20p per withdrawal over the course of four years. However, the fee will be unchanged for free-to-use ATMs that are one kilometre or more from the next nearest cash machine.