UK - The government's new simplification proposals will increase opportunities for tax-efficient exit planning by owner-managers, an independent financial adviser claims.
Inland Revenue plans will allow owner-managers of companies who want to sell their business in the year before they retire to invest the proceeds tax-free into their pension.
Contributions and benefit growth will be exempt from the annual allowance in any year in which the benefit is taken in full – up to the lifetime savings allowance of £1.4m.
PKF Financial Planning managing director Frank Williamson said this was a major opportunity to boost the value of a pension fund.
Williamson said: “The relaxation on the level of contributions that can be made in the final year of employment together with the ability to hold assets such as residential property within a pension fund will greatly enhance the opportunities for exit planning and the mitigation of income and Capital Gains Tax.”
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