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Proposed new pension rules at age 75
You may have seen the press coverage of the potential new rules regarding pensions and annuities for the over 75s.
The details of the changes have not been finalised but one of the main points of the proposals is that any lump sums left to family (on death before and after age 75) will be subject to a proposed 55% tax charge.
At present the tax charge on death before age 75 is 35% whereas after age 75 (if a lump sum can be paid) the effective rate of tax can be up to 82%!
In order to cater for those people attaining age 75 before the proposed changes take effect (estimated to be April 2011) transitional arrangements have been put into place meaning that:- Anyone reaching age 75 on or after 22 June 2010 can defer buying an annuity or taking income until age 77
- On death between age 75 and 77, there will be a 35% tax charge on any lump sum payable
- Alternatively Secured Pension (ASP), which was previously available at age 75 as an alternative to annuity purchase, will now commence at age 77
Click here for more detailed information http://www.ascotlloyd.co.ukhttp://www.ascotlloyd.co.uk
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As always, if you would like to discuss how this might affect you please get in touch. Call or email using the links below.
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Planit+ is a trading name of Ascot Lloyd Financial Services Ltd which is a wholly owned subsidiary of Planitplus Holdings Ltd. Ascot Lloyd Financial Services Ltd, is registered in England at the address below, number 02671680. Ascot Lloyd Financial Services Ltd is authorised and regulated by the Financial Services Authority under number 150620.
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