|
82%
TAX SHOCK AWAITS PENSIONERS WHO HAVE BUILT SURPLUS PENSION FUNDS
WELL-off
retired Brits who do not take available tax free cash or income from
what they consider to be surplus pension funds, could inadvertently
be lining the Treasury’s pockets – simply by not being aware of and
guarding against Gordon Brown's new taxes, of up to 82%, on residual
ASP funds on death, warns the specialist fund managers WAY Group.
Under current rules, those who have opted for drawdown as an
alternative to more traditional annuity planning, a strategy
typically deployed by the better off, may be tempted at age 75 to
transfer into an Alternatively Secured Pension (ASP) scheme.
But WAY Group chairman Paul Wilcox warns that those ending up with
residual ASP funds could be hit by punitive Treasury taxes of up to
82%, unless they make appropriate arrangements.
“If people have sufficient income from sources other than
their pension funds, it doesn’t mean they should leave their pension
funds untouched until they die, thinking that they are leaving
£100k to their loved ones is sadly wrong as the amount may shrink to
a meagre £18,000 if no action is taken ahead of time.
Although dodging the full 82% tax on any residual
ASP funds may not always be possible, there are the means of making
sure that the lion's share of any 'surplus' pension funds
find their way to beneficiaries and not to the Treasury.”
said Paul Wilcox.
As with every pension plan, pensioners have the option of drawing
tax free cash, which should be withdrawn and gifted into a flexible
trust for IHT mitigation. Following survival for 7 years the whole
of this fund will fall outside the IHT net.
They then can take
a maximum pension which, being surplus to their living requirements,
can be gifted each year (with immediate exemption from IHT) into a
'gifts from income' flexible trust, again for IHT mitigation.
Although this income will be taxed at up to 40% it will have arisen
from contributions which themselves attracted and grew under a
similar rate of tax relief and is therefore tax-neutral.
Any
further growth on either of these 2 elements will then take place
outside the taxable estate of the pensioner. WAY provides unique
products for both types of trust, linked either directly to OEICs or
via offshore insurance links, in both cases offering the donor
flexible access to funds in the future.
By planning and, especially by taking action, well in advance of
one's twilight years, it is possible to divert funds away from one's
potentially highly taxable residual ASP pension and place them
safely into an IHT-free environment for one's beneficiaries. |
BUMPER PAYOUT Predicted FOR AGE CONCERN Energy Customers
A GUARANTEED £10.50 Cold Weather Payment is set to bring a
spot of winter warmth to hundreds of Age Concern Energy Services gas
customers in Wirral over the coming months.
The guaranteed payment is part of the Age Concern Energy Services
package developed in conjunction with Powergen which combines a wide
range of other benefits together with the advantages of competitive
prices. Last winter Cold Weather Payments totalling £2 million were
given to customers between April and June. The guaranteed Cold
Weather Payment is available to gas customers of all ages. And,
along with the wide range of other benefits, the offer makes Age
Concern Energy Services one of the most competitive of the UK energy
suppliers.
“We know that many older people in Wirral struggle during the
winter months, and this year thousands are likely to feel an even
greater chill as the days shorten and temperatures fall,”
said Mark from Age Concern Age Concern Wirral. “Our Cold
Weather Payment will go some way towards helping older people in
Wirral cope and is in addition to the Government’s existing Winter
Fuel Payment and cold weather rebate schemes for older people.
However, unlike these, the Age Concern Energy Services Cold Weather
Payments scheme does not have any age restrictions, so if you are
registered as an Age Concern Energy Services gas customer at the end
of February you will qualify for the guaranteed payment; it’s as
simple as that.”
What’s more if you are an Age Concern Energy Services gas customer
aged 60 and over you may also receive an additional payment
equivalent to an extra 3 hours free use of a gas fire for each
qualifying day based on the number of days the temperature drops
below freezing point between December and February. The temperature
is taken from Pickering weather station in Yorkshire – one of the
coldest places in the UK.
More than 60,000 people switched to Age Concern Energy Services’
scheme last year. These are some of the reasons why:-
- Competitive gas and electricity prices
- Guaranteed cold weather payment for gas customers
- Four free low energy light bulbs
- Free year’s supply of carbon monoxide detectors
- Free hypothermia thermometer
- Free 24 hour customer service helpline
- Free energy efficiency advice
- A choice of ways to contact us – face to face at your local Age
Concern, online or over the telephone
To find out more about the Age Concern Energy Services package call
free on 0800 404 5010 or visit Age Concern Age Concern Wirral at
Unit 2, 142 Claughton Road, Birkenhead, CH41 6EY. |
