These changes are good news for all pension savers, with many already taking advantage. However, the increased flexibility and greater choice over how and when you access your pension savings could lead to many people making the wrong decisions and paying unnecessary tax.
Under the new rules, you can now also pass on the wealth built up through your pension savings to anyone you choose to (so perhaps grandchildren or another) with the funds still remaining within their tax-efficient ‘pension wrapper* until they are needed. Before these changes, you could only pass on your pension savings to one of your dependants (typically a spouse, civil partner or children).
With all these changes in mind, it’s now more important than ever to get advice on your retirement options.
* HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.