Life offices may have succeeded in finding a way around a potential 70% tax charge for members who want to transfer their pensions after taking tax-free cash.
In its latest newsletter, HMRC has issued clarification for scheme members who want to take tax-free cash, or pension commencement lump sum (PCLS), and then transfer the remaining funds into another scheme which offers an income drawdown facility through an unsecured pension (USP). Although on the face of it, it seems the Revenue is trying to tackle the methods used by life offices to help members keep both the PCLS and access USP, life offices say the ruling is not a problem. At the beginning of August, Aegon Scottish Equitable highlighted a growing number of enquiries on this issue, ...
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