The Treasury says the creation of an independent Scotland would cause “significant disruption” to the UK pensions market, with the associated costs likely to be borne by savers.
In September 2014, a referendum will be held which will decide whether Scotland should remain as part of the UK or leave and become an independent country.
This week, the Treasury published an analysis of the impact of Scottish independence would have on UK financial services.
The Treasury says: “Attempts at EU level to create a single market in pensions have so far not succeeded, as a result of substantial differences between member states in the areas of tax, labour law and social security.
“If an independent Scotland and the UK were to diverge in these areas, it would cause significant disruption to the pensions market.
“If Scotland were to become an independent state, pension providers would have to ensure that their products address the change in tax systems and any differences that develop in pension policy.
“Scottish independence would require pension and life insurance products to be fit for purpose for either the continuing UK market or the independent Scottish market. This could involve significant structural and organisational changes for firms that would come at a cost that firms could choose to pass on to consumers.”
Worldwide Financial Planning IFA Nick McBreen says: “If Scotland did become independent, there would be massive issues for providers and advisers to contend with.”