he following outlines key regulatory and legislative activity impacting on the UK personal finance, pensions and financial planning industry in the coming month. AJ Bell director of public policy, Tom Selby, and head of public policy, Rachel Vahey, are available to discuss any of these topics.
Key things to look out for in April:
Ø Key changes to household finances: the new tax year brings a raft of personal finance, tax and pensions changes in April, including keeping the deep freeze on most tax thresholds and increasing employer costs through the national insurance (NI) hike and increases to the minimum wage
Ø The first pension schemes connect to the Pensions Dashboard: the larger pension schemes and most of those regulated by the FCA are due to connect to the Pensions Dashboard by 30 April
- State pension increases by 4.1%, but what do unsettled UK finances mean for its future?
- In April the state pension increased by 4.1% to £11,973 a year – perilously close to the frozen £12,570 personal allowance
- The recent Spring Statement outlined that limited flexibility within current government economic plans may prompt them to explore additional adjustments, which may include the state pension
- The Office for Budget Responsibility (OBR) projects that pensioner spending will rise to £182 billion by the fiscal year 2029-30 in its latest economic and fiscal outlook
Tom Selby, director of public policy at AJ Bell, comments:
“The government is walking a precarious financial tightrope to balance its fiscal rules. With little to no wriggle room built into current plans, it may still be forced to look elsewhere for further savings. And one area that could come under scrutiny is the state pension.
“The biggest proportion of welfare spending is on pensioners. In the OBR’s recent economic and fiscal outlook, this is set to rise by 20% to £182 billion by 2029-30, mainly driven by an ageing population and the triple-lock guarantee. If the government is looking to cut costs, then pensioner spending could be something that moves into the Treasury’s crosshairs in the next few years.
“In practice, it’s not that simple. The Labour Party has pledged to protect the triple-lock guarantee, ensuring state pension increases match earnings or inflation if above 2.5%. But with the state pension rising by 4.1% this month, it’s now at a level perilously close to the personal allowance of £12,570 and should overtake it in a couple of years if things continue, thanks to frozen tax thresholds. At that point the government will have a huge decision to make.
“Any changes to the state pension will be hotly contested. But the crunch time is fast approaching when the government will finally be forced to address the question of how much the state pension should really offer, at what age, and how it can increase payments sustainably each year.”
- The starting gun on connecting to the Pensions Dashboard has been fired – when will it launch to the public?
- Pensions Dashboards have moved a step closer to becoming reality as most larger pension schemes, including most FCA-regulated schemes, are due to connect to the dashboard by 30 April 2025 (Pensions dashboards: guidance on connection: the staged timetable – GOV.UK (www.gov.uk))
- Although these larger schemes – including SIPP providers with 5,000 or more members and master trusts with memberships of 20,000 or more – are being asked to connect by 30 April 2025, they are not compelled to do this by law
- All pension schemes have to connect to the dashboards ecosystem by the final connection date of 31 October 2026
- The DWP is yet to announce when dashboards will be made available to the general public
Rachel Vahey, head of public policy at AJ Bell, comments:
“Pensions Dashboards will, this month, take a big step towards finally becoming reality.
“The larger pension schemes – including those operated by SIPP providers with 5,000 or more members and master trusts with memberships of 20,000 or more – will connect to the Pensions Dashboard, enabling them to pass on information on pension scheme members following a request by a customer for all their pension information.
“This could be the start of the dashboard revolution. Other smaller pension schemes, as well as the state pension and public sector schemes, should soon also follow suit, and eventually most pension schemes should have connected by 31 October 2026.
“Pensions Dashboards have the potential to help millions of people better engage with their pensions. Once they have a complete picture of their pension wealth, people can make important decisions such as whether to contribute more, combine pensions into one, or when and how to take pension income.
“The big question that remains is when will Pensions Dashboards launch to the public? DWP plan on setting a date only when it is confident a very high percentage of members’ pension records can be found, and once the dashboards are working well. Otherwise, it risks the project falling flat on its face if not enough people can find all their pensions, undermining public confidence.”
REGULATORY OUTLOOK: DIARY
This is a summary of key policy and regulatory developments expected this year and beyond. Dates are correct at the time of publishing but are subject to change according to updates issued by regulators, government departments and other relevant bodies.
| What | When | Who | AJ Bell View | ||||
| April 2025 | |||||||
| Employers’ National Insurance Contribution rate to increase to 15%, and Secondary Threshold to fall to £5,000 | 6 April 2025 | HMRC | Budget to batter businesses as National Insurance and minimum wage costs rise | ||||
| Business Asset Disposal Relief (BADR) for capital gains tax to rise to 14% | 6 April 2025 | HMRC | Capital Gains Tax raid will hit small shareholders where it hurts | ||||
| Existing scope of agricultural property relief to be extended to land managed under an environment agreement. | 6 April 2025 | HMRC | |||||
| Start date for guidance connection dates to pensions dashboards (including for large FCA-regulated firms) | 30 April 2025 | DWP/FCA | SIPPs to connect to the pensions dashboard by 30 April 2025 | ||||
| Spring / Summer 2025 | |||||||
| FCA to publish consultation paper on Targeted Support on retail investment products (such as ISAs) | Spring 2025 | ‘Targeted Support’ reforms could spark UK investment revolution | |||||
| Treasury Committee publish the findings of its enquiry into whether the Lifetime ISA remains an appropriate product | Spring 2025 | AJ Bell calls for Lifetime ISA rules changes alongside package of ISA reforms to boost investment | |||||
| Treasury expected to publish consultation on simplification of ISAs | Spring / Summer 2025 | HMT | Rachel Reeves sets the scene for ISA reform – here’s how she can radically simplify the system and boost UK plc at almost zero cost | ||||
| DWP to publish response to consultations on creation of ‘megafunds’ and consolidation of Local Government Pension Schemes, and Pension Schemes Bill (including VfM, UK investment, guided retirement (decumulation options)). | Spring 2025 | DWP | Chancellor set to announce pension ‘megafunds’ reforms in maiden Mansion House speech | ||||
| Bank of England’s consultation closes on increasing FSCS deposit protection limit to £110,000 | 30 June 2025 | Bank of England | |||||
| HMRC to publish response to Pensions and IHT consultation, and to publish draft legislation (possibly part of ‘L-Day’) | Summer 2025 | AJ Bell calls on chancellor to consider alternatives to IHT on pensions | |||||
| Other publications expected in 2025 | |||||||
| FCA to publish detailed rules on Targeted Support | Later in 2025 | FCA | ‘Targeted Support’ reforms could spark UK investment revolution | ||||
| Treasury to publish outcome on ban on cold calling for consumer financial services and products | 2025 | HMT | Government sets out plans to ban cold-calling for all financial products | ||||
| DWP publish Terms of Reference for Phase 2 of the Pensions Review | 2025 | DWP | Government ‘kicks pensions adequacy review into the long grass’ after Budget employer tax hit | ||||
| DWP publish updated transfer regulations changing terms for red and amber flags | 2025 | DWP | |||||
| Independent Review of planned State Pension Age increases | 2025 – 2026 | DWP | Why economic woes may force state pension review | ||||
| 2026 | |||||||
| Business Asset Disposal Relief (BADR) for capital gains tax to rise to 18% | 6 April 2026 | HMRC | Capital Gains Tax raid will hit small shareholders where it hurts | ||||
| New IHT rules including combined agricultural and business property £1 million limit for 100% relief from IHT, and 50% relief thereafter | 6 April 2026 | HMRC | IHT Reforms spark death tax raid on small businesses and landowners | ||||
| SPA to start to increase to 67 | Between 6 April 2026 – 5 April 28 | DWP | |||||
| Final connection deadline for pensions dashboards | 31 October 2026 | DWP | FCA confirms commercial Pensions Dashboards rules but firms in the dark on timescale for delivery AJ Bell Launches Free Pension Finding Tool to Track Down the UK’s £26bn Lost Retirement Savings | ||||
| Later on | |||||||
| Unused pensions to be included in the estate for IHT | 6 April 2027 | HMT | AJ Bell calls on chancellor to consider alternatives to IHT on pensions | ||||
| Income tax thresholds for rest of UK to remain frozen until | 5 April 2028 | HMT | How much frozen income tax bands are costing us as OBR reveals another huge increase in tax take | ||||
| NMPA rises to 57 (unless protected) | 6 April 2028 | HMRC | |||||
| The final Child Trust Funds mature | 2 Jan 2029 | HMRC | |||||
| ISA annual subscription to remain frozen at £20,000 until | 5 April 2030 | HMRC | |||||
| IHT nil rate band and residence nil rate band to remain frozen until | 5 April 2030 | HMRC | How two-decade freeze on IHT thresholds could cost your family over £230,000 | ||||
