Annual allowance to be cut?

Freecall

You need to be signed up to read this but I wonder if this is really being considered by George Osborne for the Autumn Statement.

http://www.ft.com/cms/s/0/81ad0c60-3325-11e2-aabc-00144feabdc0.html#axzz2CmnV9jL2

Paul_Herring

From the description, I suspect it may be the same thing in this Daily Fail article:

http://www.thisismoney.co.uk/money/pensions/article-2235712

Chancellor George Osborne is said to be considering lowering the maximum amount pension holders can save while getting tax relief from the Government from the current £50,000 to £40,000, or even £30,000.

Before Osborne's 2010 Emergency Budget the figure stood at £255,000.

That's starting to get dangerously close to what I contribute to my pension, and I'm nowhere near the 40% tax rate...

grey_gym_sock

more likely, this is either a rumour being spread by pension companies to encourage ppl to make big contributions before any changes are made, or a rumour spread by ministers to make them look generous when it doesn't happen, or to make whoever is arguing for it (presumbably, liberal democrats) look bad, or ...

don't these rumours happen almost every year? and are usually false.

mania112

A couple of years ago the government made a few changes to pensions:

Lifetime Allowance reduced from £1.8m to £1.5m

Annual Allowance reduced from £255k (wasn't it?) to £50k

Earliest age you can take benefits increased from 50yrs to 55yrs.

Max income reduced from 120% GAD to 100% GAD.

...and probably others i'm missing.

Point is, the government wouldn't want to backtrack on any of these so soon. Should they change some things? Yes.

dunstonh

The media predictions on the last few budgets/autumn statements have been dire. One paper didnt get a single one of their predictions right. I seem to recall the title of the media article was xx things you will see in the budget.

Paul_Herring

mania112 wrote: »

Should they change some things? Yes.

No.

"Something Must Be Done" is something from Yes Minister - which was a comedy series lambasting how Government worked, not as an educational series for how ministers should act.

Unless it's undoing changes that are encouraging people to stop saving for their retirement then they should leave well alone, not continue meddling.

My dog is most definitely not a cat.

mania112

Fair enough!

I think they might need to revert back to 120% GAD because folks aren't able to see a decent income on their funds.

grey_gym_sock

i agree there's actually a problem with the 100% GAD thing. and they may well do something about it, but the danger is that "something" will be "make it more complicated without solving the problem".

Aegis

mania112 wrote: »

Fair enough!

I think they might need to revert back to 120% GAD because folks aren't able to see a decent income on their funds.

The biggest issue here is that they don't want to be shown to have implemented policy that was so badly thought through that it needed redacting shortly after. As such, if they make a change it is likely to be something other than reverting to 120% GAD, which will of course complicate things further.

Just think, 6 and a half years ago we went through "pension simplification"!

mania112

Aegis wrote: »

The biggest issue here is that they don't want to be shown to have implemented policy that was so badly thought through that it needed redacting shortly after. As such, if they make a change it is likely to be something other than reverting to 120% GAD, which will of course complicate things further.

Just think, 6 and a half years ago we went through "pension simplification"!

Indeed. That's the point I was making originally, so soon after a heap of changes, they're not going to backtrack now (so I don't believe the OP is accurate) - but there are things they should change.