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Pension - 25% tax free lump sum
IssyHotten
Posts: 6 Forumite
anyone think that this might be removed, or even changed, in the near future? If so - when?
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Comments
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no idea - will have to wait for Labours first budget to see what they intend to do.0
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This has been around for as long as I remember. I can't see Labour removing/changing it now
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Another thread that I suspect is likely to be closed or removed due to inviting pure speculation and political debate.2
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We see the same question at every election and every budget.
As always, it is very unlikely that it will be removed.
It is possible that the maximum tax-free limit (currently £268,275) could be changed. I doubt it is a priority to do so.I am an Independent Financial Adviser. Any comments I make here are intended for information / discussion only. Nothing I post here should be construed as advice. If you are looking for individual financial advice, please contact a local Independent Financial Adviser.0 -
If (a very big if) a future government was to make changes to this then I expect it will only affect future contributions / accruals to a pension. To do anything else would be politically challenging to say the least.
I certainly wouldn't let fears of change stop me making pension contributions.
It's worth noting that the tax free cash limit is a fixed amount so effectively reduces spending power thanks to inflation.
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It would be very unpopular, amongst all income groups with a pension. Therefore it is highly unlikely to happen.IssyHotten said:anyone think that this might be removed, or even changed, in the near future? If so - when?
Plus it would de incentivise saving into a pension, whilst governments of all types have so far encouraged people to save into a pension.0 -
Rumours of its removal started in 1988. You are coming up to nearly 40 years of rumours that it will be removed. Yet, in that period, both Labour and the Conservatives increased the availability of tax-free cash overall. There has been a soft cap on tax-free cash since 2006, and that cap has varied over the years.IssyHotten said:anyone think that this might be removed, or even changed, in the near future? If so - when?
It was hard capped at £268,275 by the Conservatives, and Labour has said they intend to maintain that.
Tax free cash is a very small part of the overall cost to the treasury with pensions. Removal would harm the economy, cause hardship to those with low income/savings (people using it to clear debts) and would be politically damaging. There are far easier targets.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.1 -
Bad enough with the endless speculative threads around budget time. Another 3 months or so before anything gets said officially. Is going to get tiresome.3
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