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Recent study finds young adults support the proposal to expand automatic enrolment
Published: 20 June 2023 Emailed: 21 June 2023
A new study from NOW: Pensions, finds that young people aged 11 to 27 (86%) support the UK government’s proposal to reduce the age of automatic enrolment (AE) from 22 to 18.
The survey conducted, also found the willingness to explore AE from age 16, with two-thirds (66%) of young adults supporting this and echoing recent parliamentary debates. The study further revealed that 89% of students think pensions should be made a bigger part of the national curriculum. The Pensions (Extension of Automatic Enrolment) (No. 2) Bill is currently making it’s way through the House of Lords. The Bill permits two extensions to automatic enrolment – abolishing the Lower Earnings Limit (LEL) for contributions and reducing the age for being automatically enrolled to 18 years old. This will have a great impact on pension savings for young people and low earners.
NOW: Pensions, states:
‘’NOW: Pensions welcome Government support for the private members bill that will enable these measures. But we would like to see additional Government commitment on delivery of these measures – including a roadmap for implementation, and an update to Parliament within 12 months of Royal Assent. This will ensure savers will benefit in the foreseeable future, and enable savers, employers, schemes, and the industry to plan and work with Government on implementation. In addition, we suggest this Bill also offers an opportunity for Government to commit to other key matters for the future of AE pension saving and pension saver outcomes – including a formal review of AE to establish consensus about strategic direction on matters such as scope and contribution levels – to ensure it evolves beyond its initial implementation stages and remains relevant and fit for purpose.’’
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Pension schemes newsletter - June 2023 Published: 4 July 2023 Emailed: 5 July 2023
HM Revenue and Customs (HMRC) has published the ‘ Pension schemes newsletter 151 — June 2023 ’. The newsletter is published by HMRC’s pension schemes services to update stakeholders on the latest news for pension schemes.
Here are some of the key highlights:
• annual allowance (AA) calculator – this is now available to use and been updated to reflect the increase to the AA, adjusted income and money purchase annual allowance for 2023/24
• abolition of the lifetime allowance (LA) – feedback received on the impact on the payment of stand-alone lump sums (SALS) has been taken onboard. The government has amended the Finance (No. 2) Bill to make clear that any amount of a SALS in excess of the 5 April 2023 maximum, may still be paid to the member as a SALS. Where there is an excess, this is subject to the member’s marginal rate of income tax - lump sum taxation: where one of these lump sums are identified, normal PAYE rules will apply where there is 5 April 2023 maximum excess. If the member has a P45 in the current tax year from a previous source or employment and it’s dated on or after 6 April 2023, the code on the P45 on a month 1 basis should be operated and the tax from the excess amount should be deducted. In all other circumstances, including where the member has a P45 from the previous tax year, the emergency tax code for 2023/24 on a month 1 basis should be used against the payment and the tax should be deducted from the excess amount. As these lump sums will be a one-off payment a P45 needs to be issued to the recipient
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