Aegon Scottish Equitable says it has uncovered a loophole that enables people with deferred pensions to take two lots of tax-free cash.The loophole applies to policyholders who opted to take tax-free cash and defer taking the pension before July 27, 2004 but did not tell the scheme administrator or the trustee that they intended to continue to defer the pension. In calculating the new tranche of tax-free cash, the lump sum is ignored and the maximum that can be taken is 25 per cent of the notional value of the deferred pension. Aegon ScotEq says the loophole will only affect a few people and those affected will mainly those with pension schemes under the pre-1989 tax regime. It says recent attempts by HM Revenue and Customs to address confusion over the tax-free cash rules on deferred pensions have failed. Aegon ScotEq head of pensions development Rachel Vahey says: “This emphasises how complicated the simple tax regime has become. It would be a lot simpler and more in spirit with the new regime simply to say that all those who took cash and deferred their pension before July 2004 should be entitled to an additional tranche of tax-free cash rather than invoking a new rule whether the member reaffirmed the decision or not.” A spokeswoman for HM Revenue and Customs says: “The legislation prevents people enjoying two tax-free lump sums. It only applies to any dec- isions made or remade after July 27, 2004.”
Woolwich has launched what it is calling the ‘City Bonus’ mortgage to target bankers, brokers, consultants and entrepreneurs who expect large bonuses this winter.It says that only those who wish to borrow over £500,000 need apply. The new discounted tracker with an offset facility starts as a 0.51 per cent discount below the bank’s base […]
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Jupiter China fund manager Philip Ehrmann believes the key to successful capital growth for the fund will come through China successfully developing domestic demand.Jupiter will launch the China fund on October 20 and Ehrmann believes huge opportunities exist for investors in the country as the economy broadens out and becomes less reliant on exports and […]
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By Paul Caruana-Galizia, Neptune Economist
Sub-Saharan Africa’s economic renaissance continues. After growing at an average rate of five per cent over the past decade, the IMF projects an acceleration to 5.5 per cent growth among Sub-Saharan economies in the next two years, as developed economies emerge from the crisis. We expect this growth to be sustainable for three broad reasons.
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