Pensions General QROPS LOOPHOLE CLOSED BY TREASURY
13 April 2011 The government have announced legislation which takes effect from 6 April 2011. The measure will close an unintended tax loophole for UK residents transferring pension savings overseas. The government is taking steps to prevent tax avoidance by UK residents in respect of certain pensions receivable from overseas. In the absence of action, UK residents would have been able to avoid UK tax by transferring pension savings to certain overseas countries. For full details follow the links below. HMRC Statement on the Government Proposal HM Treasury Press Notice 20 April 2011 Plans to allow early access to pension savings have been shelved after the consultation revealed insufficient evidence. The proposals which were announced in a call for evidence published in December would have given people the chance to dip into their pension pots before age 55 in a bid to boost saving or assist individuals facing financial hardship. However, the Treasury have said there was no evidence that the plans would achieve these objectives and they would not now be proceeding with the idea. Follow this link to view the full response 6 July 2011 Proposals to address short service refunds, small pension pots and transfers will be put forward by the Government later this year to ensure that variations in scheme rules don’t result in people failing to save. Regulatory differences of pension schemes, including the use of short service refunds rules have been scrutinised in a Call for Evidence. Short service refunds mean that people who leave their job in less than two years get a default refund of their pension contributions. People who move jobs often could find themselves out of pocket, defeating the purpose of having a workplace pension in the first place. Responding to the evidence, Minister for Pensions, Steve Webb said: "Automatic enrolment at its core is about getting people to save for their retirement. With just over half of working people changing jobs within two years, the use of these refunds pose a significant threat to what we are doing. Responses made clear the complexity of the issues, and that changes to short service refunds cannot be made without also considering how small pension pots and transfers should be treated after automatic enrolment.” EARLY ACCESS TO PENSION SAVINGS AND TRIVIAL COMMUTATION REGULATORY DIFFERENCES IN PENSION SCHEMES TO BE ADDRESSED
CIPP Policy News Journal
09/10/2012, Page 172 of 234
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