Yesterday the Government confirmed it had agreed the radical changes proposed in the 2014 budget in relation to defined contribution (DC) pensions and their retirement benefit ‘flexibility’.
The announcement confirmed:
- Defined Contribution (DC) ‘flexibility’ will go ahead from April 2015.
- Tax-free cash will stay at 25%.
- Balance 75% can be withdrawn as a lump sum which will be taxed at individual’s marginal rate of tax
- A £10k annual contribution limit will apply after an individual accesses ‘flexibility’
- The guidance (N.B. NOT ADVICE) guarantee will be delivered by a range of independent providers, including MAS and TPAS.
- Defined Benefit (aka Final Salary) scheme transfers will still be allowed – but only after professional advice.
- Normal minimum pension age is going up from 55 to 57 from 2028.
For further information and advice in relation to this important development please speak to your usual Wingate contact or call us on 0844 406 0027 or email us at: firstname.lastname@example.org