Content
Leading article...
We can't go on like this...
General tax...
The name is Bond
Blessed are the givers
Excuses, excuses
PAYE the penalty
Silver and gold
Moving goalposts
Doctor, doctor...
Something phishy
Pension problems
Tax dot com
Unpleasant discoveries
Fair's fair (at last)
Chartered taxpayers
This year, next year
VAT...
Focus your mind
Flat rates aren't flat
Reverse the charges
Flapjack flash
Ready set ECSL
A lofty idea
Law items...
I want my lawyer
Not on my holiday
A grey area
No difference
| Before personal pensions were introduced in the 1980s, tax-advantaged pension schemes couldn't pay out until your 60th birthday - unless you were in a job where people generally retire earlier, such as a sports player. In a fit of optimism about the future, the 1988 rules allowed people to take the benefits from pension policies at 50 - although building up a fund large enough to retire by that age has been a challenge for most people. Now the age is changing again: from 6 April 2010, the minimum retirement age moves up to 55. Anyone aged between 50 and 55 at present has the opportunity to cash in a policy - taking a tax-free lump sum and starting to draw a pension - before 6 April, but if they don't, they will have to wait until their 55th birthday. Maybe in five years it will go back up to 60, and retirement will continue to disappear over the horizon. Some people may want to take advantage of this now, but the rate of annuity that can be achieved at such a young age is usually very low. Pension fund values have taken a hammering over the last few years, and we can only hope that they will recover further in the next few - this may not be a good time to crystallise the value by cashing in the benefits. But it's important to know that the opportunity is there, and it's going away for a few years.  |
© Bayar Hughes & Co., 2010.