The new tax year for 2016-2017 starts today (April 6th) which means new changes, so here is what you need to know. THE NEW STATE PENSION The new ‘single-tier’ state pension starts today which means anyone who reaches pension age from April 6th will get the full flat rate payout of £155.65 per week. This will only apply if you …
Chancellor under pressure to scrap 25% tax free lump sum
Chancellor George Osborne is facing increasing pressure to scrap the 25% tax-free lump sum people can take out of the pension pots ahead of next month’s Budget. Currently people can access 25% of their pension pots tax-free in a single lump sum when they reach 55. Think tank the Institute of Economic Affairs recently proposed the tax-free lump sum should …
Retirees move back to annuities following market volatility
Consumers have been gradually shifting back to annuities for a guaranteed income since the pension freedoms were introduced in April 2015, according to new data. Figures from eValue’s quarterly pension freedoms index covering over 17,000 people showed that in October preference for guaranteed income rose to 47%, up from 33% in April. Meanwhile preference for flexible income (i.e drawdown) dropped …
Changes to Insurance Premium Tax (IPT)
Date of change: 1st November 2015 On 8th July 2015, George Osborne, Chancellor of the Exchequer, delivered his Summer Budget 2015 to Parliament. One of the most controversial and unexpected features of the Budget was an increase to IPT. Considered a necessity by the Government but a surprise ‘stealth’ tax by industry insiders, the IPT increase has been met with …
Lifetime allowance tax take quadruples
Lifetime allowance tax take quadruples in six years According to figures obtained by Suffolk Life (from a freedom of information request), Tax revenues from breaches of the lifetime allowance on pension contributions have quadrupled in the last six years. HMRC took £94,200,000 between 2014-2015 as a result of contributions to pots in excess of the allowance, slightly down from the previous year …
Calls for crackdown on drawdown charges
Calls for crackdown on drawdown charges Which? the consumer group wants the Financial Conduct Authority (FCA) and Government to intervene in the drawdown market to ensure people are not confused by the wide range of charging options. Which? research has revealed huge differences in what pension providers are charging people looking to benefit from the new pension freedoms. Big differences …