Displaying items by tag: Lisa Webster

The lifetime allowance may have been consigned to the annals of history but the various forms of protection are still relevant in the new world, especially when it comes to the amount of pension commencement lump sum (PCLS) that can be taken.

HMRC’s January pension schemes newsletter announced changes to tax codes for pensions, and a few headlines followed proclaiming HMRC had finally fixed the over-taxation issue. It would be fantastic if that was the case, but despite nearly 10 years of getting it wrong, the problem isn’t resolved yet.

As you will be well aware, from 6 April 2027 HMRC plan to include pensions in the deceased’s estate when it comes to assessing the value for inheritance tax.

As the year draws to a close it seems appropriate to keep with tradition and reflect on what has happened in a defining year for pension tax rules.

From a pensions point of view the biggest news from the Budget was undoubtedly the fact that from 6 April 2027, pensions will fall into the deceased’s estate and therefore be liable for inheritance tax.

I have recently returned from nearly two months away from anything to do with pensions (well, aside from deciding I need a bigger fund to spend more time in all the places we visited, once we don’t have the kids in tow!).

Last year, a whirlwind of change hit the pensions industry as schemes and advisers raced to prepare for the removal of the lifetime allowance, while HMRC staff scratched their heads over exactly how it could be done before the end of tax year deadline, writes Beth Joslyn, of AJ Bell (standing in for Lisa Webster who is on holiday).

Following the changes introduced in the 2023 Budget, there has been some focus on how the death benefit rules might change.

As a much-changed Parliament gets up and running, we pension techies eagerly await the long overdue regulations to correct the drafting errors in this year’s Finance Act. 

The recent news that Labour has ditched plans to re-instate the lifetime allowance is certainly welcome.