Legislation Changes

The value of pensions and the income they produce can fall as well as rise. You may get back less than you invested.

​Budget changes in 2014 will fundamentally change the retirement income options for people with Defined Contribution pension plans such as Personal Pensions, Stakeholder Schemes and Group Personal Pensions.

’Changes to pension rules are a major challenge to consumers’
Daily Mail
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’This rule relaxation strengthens the need for financial advice’
Citywire
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​Who is affected?

  • Clients who have reached age 55 on the 6th April 2015, have money purchase pension savings in registered UK pension schemes.
  • People within current income drawdown pensions. (HMRC Aug 2014)

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What is the new plan?

  • From April 6th 2015 pension flexibility will create 'Flexible Access Drawdown'
  • This will allow funds in a money purchase arrangement to be taken as an authorised taxed lump sum subject to their marginal rate of tax and after any 'Pension Commencement Lump sum' is taken.
  • Have 25% of the fund as tax free amount
  • More consumer choice
  • Flexibility of income from age 55, this could be used to pay off debt or book that special holiday at or before retirement.
Tax treatment varies according to individual circumstances and is subject to change.