Tax Free Lump Sum after October 30th.

Jockman

Yeah I realise it has another name now but should we anticipate any alterations to this after the Autumn Statement?
If they decide to cap it, say, to £100k for anyone who has not thus far accessed it would it not now be prudent for those above a £400k pot to just have a look at taking out £25k or so?

Jasey_

Cant see much point in targeting this as it wouldn't bring anything extra in - people would just be able to access less as the lump sum - the rest just remains invested.

Nik Burrows

Hi Jockman

It has been the topic of discussion ahead of many a budget and Autum statement. For what it is worth the general feel is that PCLS or “tax free cash” is unlikely to be a target for this round.
Most talk is around changes to relief on contributions rather than major changes on accessing benefits.
If changes were to be made it is also unlikely that they would be made without notice and even, then probably not applied retrospectively. So in that case benefits accrued before the date of change would not be affected. If these changes were applied it is likely that the option to apply for protection would be in place, similar to the measures taken when lifetime allowance was first introduced.
All the above is caveated with the fact I have no real way of knowing, I have as much access to this government machine as I did the last one so I am just sharing the ramblings of many within finance circles.
Cheers
Nik

Jockman

It would certainly fit in with the approach that £100k of tax free cash is more than ample……
In my example, reducing it from the current £276k to a cap of £100k would bring in £35k more in tax.
From just one person.

Jockman

Thanks Nik and of course I take on board your comments on Protection. In normal circumstances that would be the sensible approach.
A Chancellor that has no qualms about shafting a Pensioner on £13k pa will not think twice about targeting people with larger pension pots.