Print Share

Press comment: Pension taxation requires total overhaul not tinkering


If you’re covering the Association of Consulting Actuaries report, which shows 75% of employers think the current pension tax structure was too complicated and needs simplification please see the following comment from Ian Browne, retirement expert at Quilter:

Ian Browne“When it comes to policy changes one of the biggest problems we face is knee jerk decisions to fix an issue, and what’s even worse is a slow motion knee jerk. A report from the Association of Consulting Actuaries flags the need for a collaborative review of pension taxation, something echoed by The Fabian Society and Bright Blue who are calling for a new cross-party pension commission. This seems like common sense, but apparently it is something that still needs to be said. As we edge towards the March budget rumours are already circulating about reforms to pension taxation and the most recent ones say Government are considering upping the threshold income for when someone has to pay the annual allowance from those earning more than £110,00 to £150,000.

“While this would numb the problem currently crippling the NHS pension scheme, which has garnered strong media attention, ultimately the system is still flawed. It does not cure the problem plaguing the NHS and other high earning professions. The pension taxation system is unnecessarily complicated and broken. More tinkering will make that worse.

“Policy makers shouldn’t be naïve. While the taper was one of the original issues for the NHS pension scheme, the resultant scrutiny of how the NHS Pension and Annual Allowance works has definitely opened the eyes of some doctors. They are now aware of flaws in the system such as overly complex calculations, paying taxes on pension benefits that never manifest, negative pension input amounts that get zeroed in HMRC’s favour, interest from HMRC on ‘late’ tax payments caused by the scheme not providing the right information at the right time.

“The pension taxation system needs a wholesale independent review.”

For more information contact

Kathleen Gallagher023 8072 629307990

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 £95.3 billion in customer investments (as at 31 March 2020).

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: Advice and Wealth Management and Wealth Platforms.

Advice and Wealth Management encompasses the financial advice business, Quilter Financial Planning; the discretionary fund management business, Quilter Cheviot; and Quilter Investors, the Multi-asset investment solutions business.

Wealth Platforms includes Old Mutual Wealth UK platform and Quilter International, including AAM Advisory in Singapore.

The Old Mutual Wealth Heritage life assurance business was acquired by ReAssure Group Plc on 2 January 2020.

Since its IPO in June 2018, Quilter plc’s businesses have progressively rebranded to Quilter, as follows: 

  • Quilter Financial Planning (previously Intrinsic)
  • Quilter Private Client Advisers (previously Old Mutual Wealth Private Client Advisers)
  • Quilter Financial Advisers (previously Charles Derby Group)
  • Quilter Financial Adviser School
  • Quilter Cheviot
  • Quilter Investors
  • Old Mutual Wealth (becoming Quilter Investment Platform)
  • Quilter International (previously Old Mutual International)

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.