View more on these topics

Alternative secured pensions hit by IHT

The Inland Revenue will apply inheritance tax to alternative secured pension assets upon death to avoid the schemes being used for avoidance.

Paymaster general Dawn Primarolo told Parliament this week that the Revenue is set to consult on how IHT law should be amended to apply to the simplified pension regime.

She expressed her concern that ASPs might be used for the inter-generational transfer of assets to avoid IHT, when they were introduced as an alternative to compulsory annuities for people aged 75.

Standard Life senior technical manager John Lawson says under the present regime, a Revenue statement of practice published in 1992, big pension contributions made in the two years before the contributor dies face IHT, but as a rule pensions are seldom touched by the tax.

While not wholly unexpected, Lawson says Primarolo’s statement confirms the Revenue’s plans and the consultation will allow for industry input.

Primarolo says: “The Revenue will shortly be publishing a consultation document setting out their analysis of the IHT issues. ASPs were designed to provide an alternative to annu-itisation for those with religious objections to riskpooling. They were not meant as a vehicle for inter-generational transfers by scheme members.”

Lawson adds: “This has cleared up the big issue in simplification at the moment and confirms people who use ASPs will face IHT.”

Axa director of national sales Alison Burns has a chemistry degree and she is aiming to be the catalyst in building up business relationships with the best IFAs in the market


B&B launches new mini cash Isa today

Bradford & Bingley is today launching a new e-savings Isa with a tax-free interest rate of 5 per cent a year.With only two weeks to go before the cut-off date of April 5, B&B is encouraging investors to make the most of their tax-free allowances, but says there is still time yet.Last March saw 340,000 […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm