Osborne announces pension changes
The new move will allow thousands of pensioners to leave more money to their families, or cat homes.
Next April, coincidentally a month before the election, the Chancellor will scrap the “punitive” 55% on drawdown pension funds due when the holder dies.
More than 400,000 have drawdown pensions, which are invested in the stock market. When they retire, they draw an annual income.
Drawdown pensions are seen as more attractive than annuities, which lock people into a fixed annual income.
The move is to be announced at the Tory Party conference this week, which is jizzing all over Birmingham.
It is hoped that elderly people will take more advantage of these measures, which is pretty much designed with driving them to vote Conservative at the next election. George Osborne blahed out that these moves will help those who “worked and saved all their lives will be able to pass on their hard-earned pensions to their families tax free”.
That bloody 'hard-earned'
Currently pension pots are taxed at 55% when someone aged 75 or over dies. But they are taxed at the marginal rate in the case of those who die aged under 75. In future, when someone older than 75 dies, their relations will have to pay income tax at only the marginal rate — normally 20%. No tax will apply to the relations of people who die aged under 75.
Him again: “Freedom for people’s pensions, a pension tax abolished, passing on your pension tax free. Not a promise for the next Conservative government, but put in place by Conservatives in Government now.”