Pension LTA under threat?
Discussion
Any thoughts on the reports in most papers today that gov't is looking at reducing the lifetime allowance to as low as £800k? https://www.cityam.com/treasury-planning-pensions-...
I suppose they're just kite-flying at this stage. Most historic pension changes haven't had retrospective effect but there's no guarantee that would apply to this one. Perhaps they could apply it just to new tranches of pension crystallisation? Maybe the threat of this will prompt people to bite the bullet and crystallise everything before autumn - so enormously boosting this year's tax revenues from the excess tax charge?
Personally I feel it's high time they updated the LTA conversion factor for DB pensions. I'm sure it was never intended to be set in stone for all time. Raising this could have a similar effect, albeit with similar retrospection issues, but I doubt it will happen as the gov't so likes to protect the public sector from the commercial realities of pension funding.
I suppose they're just kite-flying at this stage. Most historic pension changes haven't had retrospective effect but there's no guarantee that would apply to this one. Perhaps they could apply it just to new tranches of pension crystallisation? Maybe the threat of this will prompt people to bite the bullet and crystallise everything before autumn - so enormously boosting this year's tax revenues from the excess tax charge?
Personally I feel it's high time they updated the LTA conversion factor for DB pensions. I'm sure it was never intended to be set in stone for all time. Raising this could have a similar effect, albeit with similar retrospection issues, but I doubt it will happen as the gov't so likes to protect the public sector from the commercial realities of pension funding.
Mr Pointy said:
For me this is key. It's apalling that the Civil Service retains such inequitable pension treatment while the rest of us get raided repeatedly. They need to feel the pain.
My recollection is that it's based on a recommendation of the Government Actuary's Department but presumably someone at DWP has to commission a review of the conversion factor. And since when have turkeys voted for Xmas?!Trying to get this thread back on track, after the NHS issue diversion, interesting though that was
https://www.thisismoney.co.uk/money/pensions/artic... Seems there's a bit more mainstream media interest in the DB v. DC divide regarding the LTA. Personally I caan't see the gov't grasping this nettle.
Are there any views on how an LTA reduction might be implemented? If they follow the past precedents of offering a new level of Fixed Protection, surely it will take several years before there's a meaningful impact on tax receipts. Yet an immediate reduction in LTA would prompt cries of foul (aka retrospection).
https://www.thisismoney.co.uk/money/pensions/artic... Seems there's a bit more mainstream media interest in the DB v. DC divide regarding the LTA. Personally I caan't see the gov't grasping this nettle.
Are there any views on how an LTA reduction might be implemented? If they follow the past precedents of offering a new level of Fixed Protection, surely it will take several years before there's a meaningful impact on tax receipts. Yet an immediate reduction in LTA would prompt cries of foul (aka retrospection).
Gassing Station | Finance | Top of Page | What's New | My Stuff