I refer to your article in Money Marketing, 19 October, ‘Balls is set to axe ASPs’. Is it unreasonable to assume that ASPs will survive the pre-Budget statement which is expect- ed in December?One of the main objections to pension schemes that we encounter is a reticence to invest in them because death shortly after annuity purchase would mean that a lifetime of savings could be lost. Furthermore, the purchase of a spouse’s annuity at outset can also be wasted if he or she pre-deceases the annuitant. The introduction of income drawdown in 1995, unsecured pension as of 6 April 2006, went someway to redressing this, although compulsory annuity purchase at 75 still provided a barrier for many. Alternatively secured pension provides the perfect balance. Any remaining fund can be transferred to the pension scheme of nominated beneficiaries, while the Treasury extracts 40 per cent IHT and income tax on the remaining fund. This helps kickstart the beneficiary’s pension planning, taking a burden off the State, and counts towards their own lifetime allowance ensuring that they do not accrue more than their fair share in pension funds. Would it be fair to assume that Mr Balls is more likely to be after those arrangements which get around the IHT rules using non-earmarked ‘occupational schemes’ with less than 50 members, rather than all ASP schemes? Pandemonium would be created if he stopped ASP nine months after introducing it. Recent pension investors could take the stance that they had only paid contributions because they believed that any residual fund after IHT could be passed to their chosen beneficiaries. At least residential properties were banned from Sipps before they were allowed, whereas ASP has been with us for several months. Many investors would argue that they have been duped and could demand their contributions back. We all look forward to the pre-Budget statement and hope that it won’t mean that we have been misled into giving questionable advice. Paul F Garwood Director, Smith & Williamson , London
Speed is of the essence when you are working in an industry where the average house purchase takes 12 weeks. Admittedly, much of this is down to the grindingly slow legal system, but ensuring that a mortgage offer is achieved as quickly as possible helps speed things up.
Edeus managing director Alan Cleary has launched a scathing attack on retention fees, branding them a “web of sin” and insisting they contravene treating customers fairly principles. Cleary says lenders do not have brokers’ best interests at heart and are only out to kill the remortgage market, which could mean considerably less business for brokers […]
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Johnson Fleming employees have raised more than £400 for their chosen charity of the year, CLIC Sargent, with a series of fundraising events.
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