Hornbuckle says sorry over GAD error
Hornbuckle Mitchell has apologised after incorrectly telling advisers that some drawdown clients have a 60-day window between June 5 and August 4 to lock in to 2006 GAD rates.
Hornbuckle issued a note earlier this month claiming advisers had an “opportunity” to help some drawdown clients by securing the higher pension incomes allowed under the old GAD tables for three years.
It claimed any investor whose reference date falls between June 5 and August 4 could request for their calculation to be made up to 60 days before their reference date, allowing their new GAD maximum pension income limits to be based on the old tables. It said a person with a pension pot of £100,000 could boost their pension income by £700 by locking in the old GAD rates.
However, HMRC guidance says: “You must use the 2011 tables when calculating the basis amount for reference periods beginning on or after June 6, 2011.”
Hornbuckle Mitchell director Mary Stewart says: “We try to give advisers as many opportunities as we can but in this case we have made a mistake. I would like to apologise to anybody we may have misled. We will review our procedures internally to make sure this never happens again.”
Standard Life head of pensions policy John Lawson says: “Hornbuckle thought bringing forward the review by 60 days would change the start of the reference period but it does not. HMRC guidance is unequivocal on this.”