UK - The Inland Revenue is struggling to find ways of closing a loophole in its plans to simplify trivial commutation, an expert claims.
Trivial commutation allows people with a pension pot of less than £15,000 to take the money as a lump sum rather than receive annual payments. But there is nothing to prevent individuals opening multiple plans just under the limit to gain the tax benefits.
Clerical Medical head of industry affairs Nigel Manners said: “We called for the Revenue to give us some answers but it didn’t tell us one way or the other – and it is because it does not know how it will stop people abusing the system.”
MPs failed to place legislation into the Financial Guidance and Claims bill that would have made pension guidance default, which Just Group director Stephen Lowe said left a "bitter taste".
Aegon has called for the government to double the tax exemption on employer-arranged pension advice, up from £500 to £1,000.
Institutional investor confidence in Europe rose by 8.9 points in April with each region showing growing appetite for risk, according to State Street Global Exchange.
It has again been suggested self-employed workers could enjoy pension provision through the tax return process. James Phillips explores the latest proposals.