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Level playing field on tax could resurrect IPA

Sandler is recommending a simplification to the tax regime to create a new level playing field between pensions, unit trusts and investment trusts which could see a resurrection of the Individual Pension Account.
According to Sandler, IPA rules should be changed to allow non-life companies to compete in the pensions market. The report says the current tax regime favours life companies and &#34exerts a number of unsatisfactory influences on the market”.
Despite being launched by the Treasury last year, only Virgin Money has embraced the IPA structure.
It claims the qualifying life policy regime creates &#34distortions and complexity&#34 and recommends its abolition for new business and recommends the abolition of the 5 per cent tax-deferred withdrawal rule.
The report also calls for the exemption of investment trusts from VAT on investment management to match unit trusts and Oeics and the scrapping of Stamp Duty Redemption Tax on ITs when held in an IPA.
AITC has welcomed the proposals which it says will allow ITs to compete with unit trusts and Oeics on equal terms.
Norwich Union Sales and marketing director Peter Hales says: &#34A totally level playing field would have to take into account the less favourable regulatory regime and the requirements for regulatory capital for life companies.&#34
AITC technical director Ian Sayers says: &#34You might see investment trusts convert to take advantage of the new tax structure. But to see a real benefit the structure of IPA should be changed so that they are stand alone.&#34


ABI welcomes Pickering proposals

The Association of British Insurers has welcomed Pickering&#39s report on pensions simplification, claiming that with the Sandler review, it will provide a good platform from which to close the savings gap.It says much of Pickering&#39s recommendations reflect its own views that there are too many types of private pensions, and that customers need clearer and […]

Simpler products &#39give more motivation to save&#39

The Government should no longer rely on tax incentives to motivate people to save as there is little evidence they have been successful in increasing the overall level of saving says Ron Sandler.While not going so far as to suggest the Government should scrap exisiting tax incentives such as Isas, which would cause too much […]

Investors take the rough with the smoothing

While I understand the argument being put forward by Hargreaves Lansdown over the sale of with-profits bonds, I totally disagree with its view.Hargreaves argues that if stockmarkets rise, life companies will use profits to boost their financial strength rather than pay all these profits to policyholders. In this case, Hargreaves should never have been recommending […]

Standard Life – Personal Pension Flex

Friday, 12 July 2002 Type: Personal pension Minimum premium: Lump sum £1,000, monthly £40, annual £400 Minimum-maximum ages: 1 &#45 75 Fund links: Sterling one, fixed interest one, index linked one, property one, protection one, structured one, managed one, ethical one, stock exchange one, international one, European one, Japanese one, North American one, Pacific Basin […]

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Absence management systems gone AWOL from UK’s SMEs, reports Jelf

A quarter (23 per cent)* of the UK’s small to medium-sized enterprises (SMEs) do not have an absence management system in place, according to new research from Jelf Employee Benefits. Despite 69 per cent* of organisations having a system in place, three-quarters (75 per cent) report that it is not providing them with sufficiently empowering absence or health data to inform an effective wellbeing programme.


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