Pension Wise meaning

In this issue: Probate Trusts Court of Protection Elderly and vulnerable clients UK taxes for Private Client HMRC Manuals updates Budgets and Finance Bills Pensions, insurance and tax efficient investments Scotland, Wales and Northern Ireland International Question of the week Additional Private Client updates this week Daily and weekly news alerts LexTalk®Private Client: a Lexis+® community New and updated content Dates for your diary Trackers Latest Q&As Useful information Probate HMRC updates schedule IHT430 HMRC has issued a revised IHT430 schedule, used when claiming or choosing not to apply the reduced rate of inheritance tax where at least 10% of an estate is left to charity. The section on qualifying charities has been amended following legislative changes, meaning gifts to EU charities no longer secure IHT exemption. See: LNB News 10/09/2024 40. Source: Inheritance Tax: reduced rate of Inheritance Tax (IHT430)—GOV.UK (www.gov.uk). Trusts...

In this issue: Pension Protection Fund (PPF) Investment Retirement options Daily and weekly news alerts Dates for your diary Trackers Pension Protection Fund (PPF) PPF publishes consultation on the 2025/26 levy In a consultation document dated 12 September 2024, the PPF sets out: a levy forecast for 2025/26 of £100m (unchanged from 2024/25, the lowest to date and aligned with last year’s consulted approach) methodology adjustments to continue spreading the levy’s cost across a broad pool of risk-based payers, rather than allowing the burden to become concentrated on a smaller cohort. Specifically, the PPF would (i) cut the levy scaling factor so it does not collect more than the planned £100 million, (ii) raise the scheme-based levy multiplier to maximise utilisation of the scheme-based levy, and (iii) increase the asset and liability stresses applied to two standard deviations simpler processes for schemes to obtain levy credit for deficit reduction contributions (DRCs) ...

'financial lives' survey On 16 May 2025, the FCA reported in its 'financial lives' survey that, in 2024, 33% of DC pension holders had under £10,000 in their pot, a decrease from 40% in 2020. Among the 17,950 people surveyed between February 2024 and June 2024, 56% said their combined pot totalled £10,000 or more, up from 49% in 2020. The FCA also highlighted that one in ten people had no cash savings at all, while a further 21% had less than £1,000 available for an emergency. It additionally concluded that one in four people in the UK had what it described as low financial resilience: they had missed payments, were finding it difficult to keep pace with commitments, or lacked savings to help them through challenging periods...

From 6 April 2015, members may access ‘flexible benefits’ (defined below) once they reach the normal minimum pension age, without restriction. The requirement to purchase a lifetime annuity has been removed, and individuals can draw on their pension pot via drawdown or by taking one or more uncrystallised funds pension lump sums (UFPLSs). Amounts withdrawn are taxed at the member’s marginal income tax rate, while up to 25% remains available as a tax‑free lump sum. The government introduced these reforms to give members greater control over their finances and to enable them to draw their pensions in the way they choose. For further information, see Practice Note: Pension freedoms—an introduction [Archived]. To ensure members with flexible benefits have enough detail to make informed decisions about accessing their pension pot, from 6 April 2015 changes were made to legislation and to the Financial Conduct Authority (FCA) Handbook rules. These require trustees, managers and providers of occupational and personal pension schemes to supply retiring members with flexible benefits with specific information...

FORTHCOMING CHANGE 1: Under section 10 of the Finance Act 2022, the normal minimum pension age (NMPA) is set to rise from 55 to 57 on 6 April 2028, excluding members of the firefighters, police and armed forces public service pension schemes. The Act will also grant members of registered pension schemes a right to take benefits before 57 if, on or before 4 November 2021, they either possessed an ‘unqualified right’ to take benefits, or were in the course of a substantive transfer to a scheme that, by 4 November 2021, offered an unqualified right to a protected pension age below 57. To make use of this 2028 protection, the scheme’s rules must have included, as at 11 February 2021, an unqualified right to draw scheme benefits before age 57. For further detail, see Practice Note: Increasing the normal minimum pension age (NMPA) to 57—pensions impact. FORTHCOMING CHANGE 2: The FCA is developing a new targeted support regime designed to bridge the long-identified ‘advice gap’ by...

THIS PRACTICE NOTE APPLIES IN RELATION TO FLEXIBLE BENEFITS Under the pension freedoms (also called pension flexibilities) that came into effect on 6 April 2015, every member with flexible benefits—namely money purchase and cash balance entitlements—has a right to free, impartial retirement guidance to help them maximise their pension savings. In this Practice Note, this is called the ‘Pension Wise guidance’, taking its name from the original Pension Wise brand. From 30 June 2021, delivery of the Pension Wise guidance has moved to MoneyHelper, the public-facing brand of the Money and Pensions Service (MaPS, formerly the Single Financial Guidance Body). For details on MaPS, see Creation of the Money and Pensions Service (MaPS), below. Objectives of the Pension Wise guidance The chief aim is to equip and empower people to make informed, confident choices about using their flexible benefits and to steer them through the available options. Further aims include providing the guidance clearly and cost-effectively, and ensuring access for those who most need it. To be...