We have collated information to help you find the right support for you and your family – from guidance and top tips to managing your money, to benefits and news.
1. Useful Information
Budgeting
- Money Helper has some handy tools and guides to support your everyday finance.
- Managing your Money in Uncertain times – guidance.
2. Start saving
Saving money – whether this is for a rainy day, first home or a special treat. It is often easier said than done. It can seem difficult to know how much to save for how long it’ll take. You can find information from Money Helper, who also have a great savings calculator.
3. Credit Unions
The Ministry of Defence works closely with three credit unions under the banner of Joining Forces and has facilitated direct salary sacrifice via JPA to encourage saving and to make loan repayment simpler. Joining Forces are proactively providing impartial financial advice through visits to units and bases across the country and most importantly strive to offer the most appropriate product to Service personnel.
Credit Unions are not there to make a profit and have a proven track record of ethical lending and better in many instances levels of interest for savings.
Because credit unions are not-for-profit, the annual percentage rate (APR) is much lower than banks or payday loan lenders. Typical APR for a credit union is around 12 per cent, whereas for a payday loan it can be up to 1,500 per cent.
The three Service Providers are:
4. Insurances
Your options
Before choosing any kind of insurance, you may want to seek advice from your unit administrative staff, and also check the Services Insurance and Investment Advisory Panel (SIIAP).
SIIAP is a Ministry of Defence recognised panel. It is made up of individuals and firms who are insurance and independent financial advisers specialising in providing services to members of HM Forces.
All Member Firms must be authorised and regulated by the Financial Conduct Authority (FCA) in the UK, offer compensation rights to customers and adhere to the SIIAP Code of Practice.
Service Family Accommodation – Home Insurance
When living in Service Family Accommodation (SFA), you will need to insure your home. Standard home liability insurance does not cover SFA.
The MOD recommends that you take out a ‘Licence to Occupy’ insurance for up to £20,000. Check out the above section to find a provider for this special type of insurance. Full guidance can also be found via JSP 464, Volume 1, Part 1, Section I, Paragraph 0605.
It is advisable to also take out home contents insurance.
Top tips for Service Personnel
Service personnel and their families can have trouble in accessing commercial products and services due to their mobility and time spent outside the UK. This guidance provides you with top tips on getting a fair deal when accessing financial services.
5. Armed Forces Covenant
The Armed Forces Covenant is a promise by the nation that those who serve and have served, and their families, should be treated fairly.
The Covenant was enshrined in law in the 2011 Armed Forces Act and ensures that members of the Armed Forces community are not disadvantaged as a result of their service when accessing Government and commercial services.
Below are some of the examples of what has been done to support you:
Broadband – cancellation (2017)
March 2017 –
Armed Forces personnel will no longer have to face cancellation fees for their broadband and media packages when posted overseas or to another part of the UK.
The commitment from the UK’s biggest broadband providers representing 95 per cent of Britain’s broadband market comes into force immediately and will benefit tens of thousands of Forces households in the UK and abroad.
The change agreed to under the tenets of the Armed Forces Covenant includes BT, EE, Plusnet, Talk Talk, Sky and Virgin Media, who have all committed to treating Service personnel fairly when cancelling their contracts.
Up until now, members of the Armed Forces who are deployed overseas or to different parts of the UK not covered by their provider could be forced to pay a cancellation fee. They will no longer have to face this cost and be disadvantaged due to the mobile nature of Service life.
Overseas assignments – motor finance (2022)
June 2022 –
A new protocol was launched in June 2022 to help ensure that motor finance works better for those who are assigned overseas.
This provision, jointly published by the Finance & Leasing Association (FLA) and the National Franchised Dealers Association (NFDA), will operate as part of the existing Armed Forces Covenant, so that personnel are not disadvantaged compared to civilian customers.
The key commitments are as below:
- FLA lenders who participate in the protocol will allow a financed vehicle to be taken overseas for the remainder of the finance agreement, so long as the vehicle is comprehensively insured while there. Where Service personnel do not wish to/unable to take their vehicles or are deployed overseas before the end of a motor finance agreement, motor finance providers should use their best endeavours to find a solution that that is acceptable to the customer.
- The FLA will also include these principles in the Specialist Automotive Finance learning material which used by dealers, brokers, and motor finance provider staff across the industry.
- For Service personnel, they should notify their Service commitment to the retailer when seeking financial arrangement. If possible, give an indication of the likelihood of receiving an overseas assignment.
- The Ministry of Defence (MOD – Armed Forces People Support team) and the FLA will keep the effectiveness of this Protocol under regular review, exchange information on its operation, and support each other’s functions under it.
- You can read an article about this news from Homeport magazine (Autumn ‘22, p. 68).
This news is a result of the NFF advocating on your behalf.
Last April, we were contacted for advice by a Service personnel who was due to begin a short notice draft in Portugal. His vehicle was under a Personal Contract Purchase (PCP) agreement. At the time that he took out the PCP, he was advised verbally that overseas postings would not be an issue. However, the company informed him that this is not possible upon notifying his intention. Although the Service personnel had written to their dealership and finance provider, he had to take a loan to buy the car outright.
With his permission, our team took his lived experience to the MOD and the Defence Relationship Management (DRM) team, alongside other stories and feedback from the wider Service community.
We are delighted to share this positive news story with you. The NFF cannot influence changes without your input, please contact us.
6. Free Legal Advice
The Queen Mary Legal Advice Centre provides free legal advice to members of the public.
These services are provided by their Undergraduate and Postgraduate law students, supported by a number of qualified lawyers. This enables Queen Mary students to learn from practical experience whilst supporting clients with their concerns.
The Centre offers legal support during term-time (October to May) to individuals, groups and businesses on a wide range of legal issues.
Visit their FAQ page for more information.
7. Making a Will
It’s important to make a Will and keep it up-to-date, to ensure that your money and possessions are allocated according to your wishes. Failure to leave a Will can mean that family and friends have to make difficult decisions on your behalf when they are unsure of your wishes.
These charities offer free will writing services:
- Royal British Legion (RBL) Free Will Writing Service -There is no obligation to donate for this service, but a gift to RBL being included in the Will is always appreciated.
- The Royal Navy & Royal Marines Charity (RNRMC) – The RNRMC has partnered with legal experts to offer free Will writing services.
- Will Aid – Free Will Month – this is a UK wide scheme which runs every November to offer free wills to people of any age. Will Aid teams up with over 1,000 solicitors to provide basic wills.
Exemption from Inheritance Tax for Fallen Personnel
There is an unlimited exemption from inheritance tax for members of the Armed Forces, and former members, where active service was a contributory factor in their death, whenever it occurred. If you’d like to find out more please see section 154 of the Inheritance Tax Act which is referred to by the MOD and HMRC. To find out more information, please contact the Joint Casualty and Compassionate Centre (JCCC).
Power of Attorney
The Power of Attorney is a legal document whereby one person gives another person/persons the power to act on his or her behalf with regard to his/her health or financial decisions.
8. Benefits, National Insurance and Tax
Child Benefit
Did you know that you can get Child Benefit if you’re responsible for bringing up a child who is under 16, or under 20 if they stay in approved education or training?
Only one person can get Child Benefit for a child and there are no limits as to how many children you can claim for. By claiming Child Benefit, you can get:
- an allowance paid to you for each child – you’ll usually get it every 4 weeks
- National Insurance credits which count towards your State Pension
- a National Insurance number for your child without them having to apply for one – they’ll usually get the number shortly before they turn 16 years old
If you choose not to get Child Benefit payments, you should still make a claim to get the other advantages.
More information about Child Benefit, and how to claim this payment, can be found here: Child Benefit: How it works
High Income Child Benefit Charge
If you or your partner earn over £60,000, you need to be aware of the High Income Child Benefit Charge.
You may have to pay the High Income Child Benefit Charge if you or your partner have an individual income that’s over £60,000 and either:
- you or your partner get Child Benefit
- someone else gets Child Benefit for a child living with you and they contribute at least an equal amount towards the child’s upkeep
It does not matter if the child living with you is not your own child.
Does it apply to me?
To work out if your income is over the threshold, you’ll need to work out your ‘adjusted net income’. Your adjusted net income is your total taxable income before any allowances and not including things like Gift Aid. Your total taxable income includes interest from savings and dividends.
We would encourage you to use the Child Benefit tax calculator to get an estimate of your adjusted net income, especially if you are in receipt of any additional allowances as a result of your Service e.g. if you have been deployed, as this may affect your total earnings.
More information about Service allowances can be found in JSP 752 Tri-Service Regulations for Expenses and Allowances
Marriage Allowance
Did you know that you could pay less tax by applying for Marriage Allowance? If eligible, the non-servingpartner can transfer a proportion of their allowance to their other half. To apply, you must be married or in civil partnership, one of you must earn less than £12,750 and the other must be a basic rate taxpayer. You can register at any point in tax year.
Universal Credit
Universal Credit (UC) is a benefit being rolled out to replace the old legacy benefit system, including Housing Benefit; and UC now includes a housing costs element. This is to help with living costs for lower income families. You can use this free benefit calculator to find out what you may be entitled to claim.
Tax in Scotland
The Tax Mitigation payment is in place for those who are affected by the increase in Scottish tax rates to protect serving personnel from paying more tax than their counterparts in the rest of the UK. Find out more about the Tax Mitigation payment here.
National Insurance Credits
You may be able to get National Insurance credits if you’re married to or the civil partner of a member of the Armed Forces and you go with them on an overseas assignment.
Credits can help to fill gaps in your National Insurance record, for example if you were not in work when you were with your partner on an overseas assignment. Credits can make sure you qualify for certain benefits including the State Pension.
Class 1 credits are available for periods spent overseas accompanying your serving person since 6 April 2010. They can help to protect your entitlement to the State Pension and other benefits such as the new-style jobseekers’ allowance. These can be applied for four months before returning from overseas, and you should apply before the end of the tax year following the tax year when the posting ended. A tax year runs from 6 April to 5 April.
Class 3 credits are available for any period you spent overseas accompanying your serving person from assignments on or after 6 April 1975. There is no time limit for claiming. These protect your entitlement to the State Pension only.
9. Childcare
Childcare by relatives
Specified Adult Childcare Credits – these National Insurance (NI) credits were introduced from April 2011. You may be entitled to receive these NI credits if you are a grandparent, or other family member, who cares for a child under 12, usually whilst their parent (or main carer) is working. These credits are only available from April 2011 and you must make an application to receive the NI credits.
Tax-Free Childcare Account
Do you know you can save up to £2000 per child, increasing to £4000 a year if a child is disabled a towards help with your childcare costs? If you are eligible to get Tax-Free Childcare, you’ll need to set up an online account. For every £8 you pay into this account, the government will pay in £2 to use to pay your childcare provider.
Top Tips
- You can get Tax-Free Childcare at the same time as 30 hours free childcare (England only) if you’re eligible for both.
- You will need to have a TFC account to be able to claim for Wraparound Childcare (WAC). Our childcare section holds a wealth of information.