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Annual allowance taper calculator launched to support advisers with complex pension tax reforms


A new pension planning calculator will launch ahead of tax year end to help advisers deal with complex changes to the annual allowance. 

The annual allowance taper calculator, which is built and operated by Old Mutual Wealth, will be rolled out to advisers through February and March.

Former Chancellor George Osborne announced in Summer Budget 2015 that the pensions annual allowance would be reduced for those earning over a certain threshold.

Individuals with an ‘adjusted income’ of over £150,000 and a ‘threshold income’ over £110,000 are affected.

For every £1 of ‘adjusted income’ over £150,000 an individual loses 50p of their annual allowance. This tapering effect means someone with income of £210,000 is left with an annual allowance of just £10,000, a 75% reduction on the standard £40,000 annual allowance.

The taper came into effect from April 2016 meaning the first tax year end on which it has a bearing will be 16/17.

With the help of their professional financial adviser clients that are affected will be able to calculate their maximum pension funding opportunity using the tool from Old Mutual Wealth.

The calculator takes into account the complex rules around defining adjusted and threshold income, as well as any carry forward allowances available.

Old Mutual Wealth managing director of UK distribution, Scott Goodsir, says:

Scott Goodsir

“We wanted to build something that automated the complex calculations involved in tax year end pension planning. Giving advisers this tool will allow them to simplify part of the advice process, focussing their attention instead on client engagement, rather than crunching figures to deduce their client’s annual allowance.

“Taking advantage of the annual pensions allowance is crucial to good financial planning, allowing clients to maximise their long-term savings capacity and ensuring they don’t forgo the opportunity to fund using carry-forward. Under the new taper this is especially important since the maximum allowance is so severely curbed for higher earners.”

For more information contact

Michael GlenisterOld Mutual Wealth020 7778 963807469

Notes to editors:

About Quilter plc:

Quilter plc is a leading wealth management business in the UK and internationally, helping to create prosperity for the generations of today and tomorrow.

Quilter plc oversees £116.5 billion in customer investments (as at 30 June 2018).

It has an adviser and customer offering spanning: financial advice; investment platforms; multi-asset investment solutions and discretionary fund management.

The business is comprised of two segments: Wealth Platforms and Advice and Wealth Management.

Wealth Platforms includes the Old Mutual Wealth UK Platform; Old Mutual International, including AAM Advisory in Singapore; and the Old Mutual Wealth Heritage life assurance business.

Advice and Wealth Management encompasses the financial planning network, Intrinsic; Quilter Private Client Advisers; discretionary fund management business, Quilter Cheviot; and Quilter Investors, the Multi-asset investment solutions business.

The Quilter plc businesses are being re-branded to Quilter over a period of approximately two years:

• The Multi-asset business is now Quilter Investors

• Intrinsic to Quilter Financial Planning

• The private client advisers business is now Quilter Private Client Advisers

• The UK Platform to Quilter Wealth Solutions

• The International business to Quilter International

• The Heritage life assurance business to Quilter Life Assurance

• Quilter Cheviot will retain its name

This press release is for journalists only and should not be relied upon by financial advisers or customers.

Please remember that past performance is not a guide to future performance. The value of investments and the income from them can go down as well as up and investors may not get back any of the amount originally invested. Exchange rate changes may cause the value of overseas investments to rise or fall.

This communication is issued by Quilter plc.  Registered office: Millennium Bridge House, 2 Lambeth Hill, London EC4V 4AJ, United Kingdom. Registered number: 6404270.  Registered in England.