fundamental review of drawdown for a longer term solution.

SallyG

http://www.moneymarketing.co.uk/pensions/robert-graves-scrap-the-link-between-drawdown-and-annuity-rates/1068535.article

"..........A rule change should allow funds on death to be passed tax-free to beneficiaries’ pension arrangements..........."

GhIFA

Interesting article. Raises some good points for discussion.

Personally, and this is just my opinion, I can't see the suggestion to remove the 55% tax charge on lump sum death benefits being adopted - it's where HMRC get back as much of the relief as possible that's been given over the years.

There's a balance to be found between allowing more "personal control" over how much income is taken, and protecting the public purse from having to pick up the slack from those that wouldn't manage their fund prudently. How that balance is found is another matter entirely!

Flexible Drawdown is still a bit of a niche approach, but maybe a reduction in the Minimum Income Requirement would open it up to a wider audience, thereby giving more people greater control over their funds, maybe coupled with a reduction in the death benefit lump sum tax charge??

The suggestion of individual underwriting of plans to provide personalised GAD rates is also an interesting proposition, although I can't help thinking that some providers would take this as an opportunity to increase charges.

Haven't thought these ideas through in great detail (it is Friday evening!) so feel free to shoot them down - just throwing them out for discussion.