Latest Blogs
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Tilley: Rebooting the FOS makes sense
I’ve written before about the lack of coherence in the UK’s pension complaints landscape and it remains a source of real frustration for those of us working in the sector.
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Lisa Webster: Pension age uncertainty lingers on
We’ve known for many years that normal minimum pension age, NMPA it's known, is going up.
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Lisa Webster: Beware IHT and pensions double taxation
One of the most disliked aspects of bringing pensions into the estate for inheritance tax (IHT) purposes from 6 April 2027 is the double taxation that will occur when the member dies on or after their 75th birthday.
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Tilley: Are we asking too much of pension savers?
Working in UK pensions, I’ve always accepted that the system evolves. Fiscal pressures change, demographics shift, and governments recalibrate policy objectives. But even allowing for that, the pace and volume of legislative change in the pensions space over the last few years feels unprecedented, and in my view increasingly problematic.
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Lisa Webster: Should tax-free cash always be taken?
Since the Lifetime Allowance was abolished and replaced with the Lump Sum Allowance (LSA) and lump sum and death benefit allowance (LSDBA), we have seen an increase in SIPP members who want to take drawdown only – foregoing the right to take the associated pension commencement lump sum (PCLS).
Popular News
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Pension VfM framework must be for savers: SPP
The Society of Pension Professionals (SPP) has urged the Government’s proposed pension Value for Money framework to be directed to help savers, not just trustees, regulators and governance bodies.
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SPP elects Hymans Robertson’s Cooper as president
The Society of Pension Professionals (SPP) has elected Calum Cooper, partner & head of pension policy innovation at Hymans Robertson, as its next president for a two-year term which began on 1 June.
Work and Pensions Secretary Liz Kendall has confirmed that the third statutory Government review into when and how to raise the State Pension age will begin straightaway.
The Society of Pension Professionals said the revival of the government’s landmark Pension Commission is good news as it will consider a wide range of potential solutions rather than focusing solely on automatic enrolment.
Nearly one in 10 estates liable for inheritance tax paid more than £500,000 in the latest available year, with the number expected to soar from April 2027 when pensions are set to be included in IHT calculations.
In the 2021/22 tax year, 2,520 estates paid more than £500,000 in IHT, a 29% increase over three years.
If the trend seen over three years to the end of 2021/22 continues, more than 3,524 estates will pay £500,000 or more in IHT by end of the current tax year.
The figures were obtained through a new FOI by wealth manager Rathbones.
They showed that of the 27,850 estates liable for IHT in the 2021/2022 tax year, 1,630 paid between £500,000 and £999,999 in IHT, while a further 890 estates paid more than £1m.
That totals more than 2,520 estates, 9% of all estates in the year that were liable for inheritance tax. That represents a 29% increase from the figure recorded at the end of the 2018/19 tax year, and the number is rising, Rathbones warned.
Rebecca Williams, divisional lead of Financial Planning at Rathbones, said: “More and more people will be caught out by IHT charges, despite the availability of gifting allowances and the seven-year rule. The deep freeze on both the main nil-rate band and the residence nil-rate band, unchanged since 2009 and 2017 respectively, has led to a creeping form of fiscal drag.
“As house prices and asset values have steadily risen, more estates are being brought into the IHT net simply because the thresholds haven’t kept pace with inflation.”
She said the issue will worsen from April 2027, when pension assets are brought into the fold and the change could pull even modest estates into scope for IHT.
She said that makes it increasingly vital for families to engage in effective Financial Planning. “Without proactive steps, more estates will find themselves facing IHT bills they might not have anticipated.”
Additional research by Rathbones on the impact of the Government’s plans around IHT found that nearly one in three, 31%, people with pensions say they are put off making further contributions to their pension pots by the changes, which means they lose the tax efficiencies of pension saving.
The money they are no longer contributing to their pensions is most likely to be put in cash – around two out of five, 39%, questioned said they will deposit the money in savings accounts while 25% plan to invest some of the money in equity ISAs.
Almost one in seven, 14%, questioned say they have already changed their focus to property investment as a result of the decision.
Rathbones commissioned Viewsbank to survey 619 people with pensions, cash ISAs, investment ISAs, shares, investment funds and cash savings between March 14th and March 17th,. The sample represented the demographic profile of the UK.
British people in their 50s feel the least confident about retirement, according to new research from Aegon.
The Government is reviving the Pensions Commission to look at ways to tackle the problem of people not saving for their retirement.
The Financial Services Compensation Scheme has declared failed Sussex-based wealth manager and Financial Planner Facet Investment Management Ltd (FRN 131372) in default.