Retirement solutions

 

Pensions update - changes to death benefits

There have been many changes to pensions recently, one of which is that policyholders are now allowed to pass on their pension savings to a nominated beneficiary, potentially without having to pay a tax bill.  It is thought this relaxation of the rules...

Pensions are not like bank accounts after all!

Following the implementation of the pension freedom rules in April 2015, tabloid headlines have given us the impression that pensions now operate like a bank account.   Although pensions have become more flexible, the reality is that they cannot be...

High earners' pension relief cut

Following the 2015 summer Budget, those earning more than £150,000 will no longer qualify for an annual allowance of £40,000 (the annual allowance is the maximum that can be paid into a pension in a single tax year).  Instead, high earners...

Workplace pensions auto enrolment

Over the next few years all employers will have to auto-enrol all “eligible” workers into a workplace pension scheme.  The biggest employers started doing this in October 2012, when the Pensions Act 2008 came into force. An employer must...

Action for the start of new 2012/2013 tax year commencing 6 April 2012

Mike Cracknell from Birkett Long examines how you can make the most of tax efficient financial planning opportunities before the current tax year ends on 5 April 2012 and the new year commences 6 April 2012. 1. Make the most of Individual Savings Accounts...

Workplace pensions

Background   The 2003–2005 Pension Commission reviewed the UK pension system and concluded that: i. up to 12 million people were not saving enough to provide for their retirement, ii. the State Pension could not meet the financial commitment of...

EIS and VCT

One of the negatives for pension savers is the new annual £50,000 limit on contributions, and this is already causing high earners to look for alternative forms of tax-efficient investment, such as Enterprise Investment Schemes (‘EIS’),...

Pensions liberated

The new tax year marks a new era for pension saving in which the keynote is flexibility. With effect from 6 April 2011, the obligation to crystallise pension savings in the form either of an annuity or a restricted type of pension drawdown called...

More choice over pension

New pension rules - giving greater flexibility to individuals taking retirement benefits - are expected to be operative from 6 April 2011. Historically, individuals have had to set up a lifetime annuity or move into an Alternatively Secured Pension (ASP)...

Tax planning in general terms applicable to 2011

Employers should utilise salary sacrifice for their employees making pension contributions to an employer's pension scheme to contra rises in both the rate of Primary and Secondary Class 1 National Insurance.   Third party pension contributions -...

Action before tax year end 5 April 2011

For individuals with a "relevant income" of £130,000 or more (i.e. effected by the "anti-forestalling rules") for the 2010/2011 tax year, to make gross pension contributions to the value of £20,000 or £30,000, as...

Lifetime allowance

The maximum value of the pension pot which can be accumulated during an individual’s working life without incurring a tax penalty (the “Lifetime Allowance”) will be reduced from the current level £1.8m to £1.5m from April 2012....

Annual allowance

The maximum pension contribution on which tax relief is allowed is also changing. With effect from 6 April 2011 a new limit of £50,000 p.a. will apply to personal pensions and other defined contribution schemes, whether the payments are made by the...

Annuity rule axed

In another major pensions concession by the coalition Government, the requirement that pension savings must be 'secured' by the purchase of annuities is to be scrapped as from April 2011. Savers will be able to maintain their pension policies in...

Simpler pension rules

The new coalition Government indicated that it is committed to simplifying pension schemes and granting tax relief on contributions paid. Although subject to possible further amendments, the most significant rule changes are: Permitted contributions The...

Making the Most of Your Pension

You save money in your personal pension for the majority of your working life but is the return you receive at retirement the best available? If you automatically take the retirement benefits from your existing pension provider you could be losing out. In...

Pensions - How much is enough?

Over the last two decades the pension barometer has swung away from the civil servant “final salary” style of scheme to the now more common “money purchase” scheme. In simple terms (with the aid of various tax relief concessions) a...

Poverty levels among UK's elderly "shocking"

A charity has described European Commission figures revealing high poverty levels among over-65s in the UK as "shocking". Data from the European Centre showed that the UK has the fourth highest level of poverty among over-65s in the 27 member...

Final salary pension 'crippling' struggling businesses

The CBI has warned that firms struggling to survive the recession risk being dragged down further by their final salary pension schemes. Many businesses face closure unless they are given more time to pay off the shortfalls, the lobby group claimed. It...

Top Tax Tips

The current 2008/09 tax year will be remembered for an unprecedented series of financial and economic events. With Bank solvencies, cash flow and in some instances merely financial survival in the foremost thoughts of many, it is more important than ever to...