The Chancellor has announced some of the most far reaching changes to personal pensions that we have seen for some time. They are mainly aimed at providing a greater choice at retirement and remove the neccessity for an individual to purchase an annuity. New rules came into force from on the 6th April 2015.There are new rules for the special classes of drawdown pension known as "capped " and "flexible". There are also new rules for pension commutation. It is now possible to take the whole of your pension as a cash sum if in total, it does not exceed £30,000. However, caution is required becase only 25% is tax free, the balance is added to your existing income and could put you into a higher rate tax band!!!!
General description of the new measures
A number of changes are being made to pension tax rules to reflect the greater flexibility individuals will have to access their pension savings from age 55. The changes will:
These changes bring an increased level of complexity into retirement planning and the headlines understate the potential pitfalls. Whilst the Chancellor has announced that free "guidence" will be available to all retirees, it will be nothing more than a broad brush overview of what is available and will not reflect the specific cicumstances of your own situation.
MHI provide a full pensions advisory service. We will help you with your retirement planning to ensure that your goals, if possible, can be met and that yourincome is not eroded by inflation or that if you wish to provide for your partner after your death that he or she is properly provided for. WE will look at your overall financial posision. With the population living longer than ever before it is very important to get it right!
We are able to provide guidance on more complex arrangements such as pension drawdown. These avoid locking into low annuity rates and you can have a wide choice of investment strategies.
Please contact us to discuss your requirements.