LEBC welcomes the Government’s stated aim to assist savers and those approaching retirement. However we do regret that there was no room in the Queen’s Speech to clarify the position of current pension savers who are affected by the Money Purchase Pension Allowance (MPAA) nor a renewed commitment to raise the tax free allowance for employer sponsored advice for employees from £150 to £500 per year.
Changes to both these allowances were due to be included in the Finance Bill but were weeded out due to the General Election being called.
This leaves older workers who have flexibly accessed their pensions unable to plan for their eventual retirement with certainty. They do not know if they can fully participate in their workplace pension without incurring a tax charge. This continued uncertainty is unfair and a simple statement from the Treasury could resolve this matter.
Similarly failure to confirm the non-contentious employer sponsored advice allowance increase to £500 a year inhibits those employers who wish to provide staff with pre-retirement advice, as they are unsure of the tax position for their employees on the cost of that. Again, a simple clarification would assist millions in receiving the help they need to plan for a successful retirement.
Director of Public Policy, LEBC
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