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Pension scheme changes
From the 6 April 2011 the current requirement to purchase an annuity by the age of 75 will stop and in the meantime, the age will increase to 77.
Although there is still more information to be made available, we now know what the likely structure will be as summarised below:
- Your personal choices are to buy an annuity, or leave the pension fund invested and take a capped drawdown as income or flexible drawdown as income.
- Flexible drawdown will allow you to take as much as you like net of income tax, but with the requirement to secure a minimum income from part of your fund.
- If by the time of your death you have not bought an annuity, the current tax charge on the fund passing to your beneficiaries is potentially 82%. This will reduce to 55%.
HWB work in partnership with Argentis Financial Management Limited to offer our clients a free financial planning review. If you would like more information, please do not hesitate to contact us on 023 8046 1200.
HWB
Chartered Accountants, Highland House, Mayflower Close, Chandlers Ford, Eastleigh,
Hampshire, SO53 4AR.
