Lump sum rumours!

Aceshigh_2

HI, can anyone help. I currently work for the London Ambulance Service and there have been rumours of the good old Government changing the rules next year on lump sums in that they plan to tax quite a large amount of it. I have tried contacting my pensions department but they are not answering the phone.
Does anyone know if this is true ?

Aceshigh:A

Aegis

There are no such plans for the tax free lump sum at present, though rumours always abound.

Linton

The government has announced it's proposals for next year's pension rule changes. They dont include any change to the 25% tax free lump sum.

The proposals for next year dont affect Defined Benefit pension schemes anyway.

dunstonh

I currently work for the London Ambulance Service and there have been rumours of the good old Government changing the rules next year on lump sums in that they plan to tax quite a large amount of it.

Always the NHS that has these rumours.

Does anyone know if this is true ?

No. its just mischief making in the NHS. A month doesnt seem to go by over the years without someone in the NHS posting about these rumours.

kidmugsy

dunstonh wrote: »

No. its just mischief making in the NHS. A month doesnt seem to go by over the years without someone in the NHS posting about these rumours.

Does this imply that the unions in the NHS assume their own members to be peculiarly gullible?

hyubh

Aceshigh wrote: »

I currently work for the London Ambulance Service and there have been rumours of the good old Government changing the rules next year on lump sums in that they plan to tax quite a large amount of it.

Such a thing would have perverse consequences for public sector DB schemes given their intentionally bad (from the member's POV) commutation rates. Or in other words: were this to happen, it would be with respect to general pensions policy, not reform of the NHS pension scheme specifically, which is what your 'next year' is possibly alluding to.

mgdavid

kidmugsy wrote: »

Does this imply that the unions in the NHS assume their own members to be peculiarly gullible?

quite possibly; fortunately many of them are at least smart enough to come here and ask :-)

Spursman180

The 3 Labour manifestos before the Tories got in a certain Mr Brown had proposed taxing pension lump sums as part of the final years earnings. This was abandoned by Blair as it was going to be an election loser.

Some ideas don't go away and I'm sure that it will resurrect itself sometime in the future.

It is something that I watch out for closely as it would cause me to jump into retirement rather than pay 40-45% on it.

If it looked like a Government was on it's way out I'm sure the spiteful and vindictive nature of the outgoing politicians would look to poison as much as possible the incoming party's chances. I beleive that would happen whichever way the change of Government was going to happen.

elantan

I remember asking this exact same question a good few years ago as husband had been told by his union the same info, he works in the private sector but in an area that was publically owned till sold off

The sad thing is plenty of people in my husbands work believed it, loads have started drawing their pensions early and loads have came out ( my husband seems to be the odd one out tbh) for the last few years people have left after taking their much reduced pension and others just had 6 month holidays whilst they spent their lump sums ... With the possible exception of a couple of the managers every single one has had to come back to work as they are now skint

One person in particular was slagging my husband off for still paying into his pension, he said he hasn't paid since they heard about the taxing of the 25% ... His manager came up to him and asked him what age he is ... The guy said 64 the manager replied oh just another years work for you then you will be looking forward to retiring, the guy started saying I don't have a pension anymore ( he took his lump sum as well... Gets a tiny pension now) his boss replied not my problem really, you should've thought about that, the poor guy starts saying to the boss but I can't go, the boss's reply, well you can't stay, we have an obligation to your health, and with your medical conditions you are not fit to work ( brain anueyrism, hernia, heart issues)

The guy is now panicking about his future ... Thank goodness my husband spoke to me and I came on here and asked... We could've have been in a similar financial position

I wish the people that started these rumours would have a think about possible consequences of their words ... And I wish people would ask before blindly believing rumours as well

gadgetmind

kidmugsy wrote: »

Does this imply that the unions in the NHS assume their own members to be peculiarly gullible?

Well, as their members seem to swallow it hook line and sinker every time...

gadgetmind

elantan wrote: »

the poor guy starts saying to the boss but I can't go, the boss's reply, well you can't stay

Sounds like said boss needs to learn a little more employment law.

https://www.gov.uk/retirement-age