As of 6th April 2015, new pension rules have come into effect that are intended to give individuals more control and greater flexibility over what they can do with their pension.
As leading financial advisors in Lancaster, we want to help all of our valued clients understand these changes as much as possible and this article has been produced to help explain what new legislation is now in force and how these changes may impact you and your pension.
What Changes Have Been Made?
Adjustments have been made to several areas but especially with regard to the following:
- Flexi-access drawdown funds
- Uncrystallised funds pension lump sum
- The money purchase annual allowance
- Reporting requirements
- Death benefits
- International pensions
More information is available via the associated Government website.
Why the Changes?
These changes are intended to ensure that the tax system is fairer, and aims to offer people more choice about how they access their money purchase pension savings.
Alterations have also been made to pension rules in order to prevent this flexibility from being exploited by individuals or groups to gain a tax advantage.
Who is Likely to be Affected by the Changes?
These modifications are likely to impact a substantial number of people, and the Government has advised that you are likely to be affected by these changes if you:
- Have reached the normal minimum pension age (usually 55 years old) and have money purchase pension savings in a registered pension scheme or non-UK pension scheme
- Have a drawdown pension
- Are a beneficiary of a person/s who has died with pension savings in a registered pension scheme or non-UK pension scheme
- Are a scheme administrator of registered pension schemes
- Are a scheme manager of non-UK pension schemes
If you are unsure of whether or not the changes to pensions affect you, we highly recommend that you speak to your financial advisor. If you don’t yet have such an advisor, then we can certainly help.
We hope you found this information helpful and that now you’re now more aware of the pension changes that came into effect on April 6th 2015. If you have any questions about your pension or any other financial matters, Burton and Fisher can provide you with all the information you need to know, as well as offering professional advice. For more information, contact us today by calling 01524 416511.