View more on these topics

Tax adviser attacks HMRC for inflexible stance on annuities

HM Revenue & Customs is being inflexible to the point of authoritarian by forcing people who reach 75 before A-Day to buy an annuity, says tax and business advis- ory group Vantis Financial Management.

People whose 75th birthdays fall after A-Day on April 6, 2006 are not required to buy an annuity.

Vantis poionts out that if an annuity is purchased and the holder dies, the entire pension fund is lost.

People who do not purchase an annuity can, in some cases, pass the money indirectly to their family through their pension funds.

Director Mike Pole says, due to their date of birth, some people could face a tax pen- alty of up to 40 per cent of their pension assets.

Pole says: “The 75 age bracket does seem to have been overlooked by the HMRC. We understand that there has to be a cut-off point but the system does seem unfair.

“If one client reaches 75 on April 4 and the other on April 6, one is set in a much better position than the other. While HMRC seems to be relaxing the rules, it seems to be inflexible to the point of authoritarian on this particular point.”

Unity Independent Financial Planning company director Jon Willis says: “The problem is where do you draw the line? It is unfortunate for the people who miss out but there has to be a cut-off point.”

Recommended

Industry concern over Blunkett’s resignation

The Government must move quickly to find a replacement for David Blunkett as secretary of state for Work and Pensions in order to maintain industry confidence in pension reform.Industry commentators are dismayed at the timing of Blunketts resignation, coming less than a month before the Pensions Commission is due to present its second and final […]

Skandia asks the experts

Skandia Investment Management has brought out a global property fund which will be managed by property investment specialist La Salle Investment Management.

F&C calls off outsourcing deal

F&C will not be outsourcing former Isis operations to Mellon despite agreeing in principle a year ago. The firms failed to agree on contracts.

Income FOF from New Star

New Star has established a unit trust fund of funds that aims for growth and an estimated net income of 3.5 per cent a year while preserving investors original capital

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    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

    Email: customerservices@moneymarketing.com