Government Pension Tax Plan Gets a Hard Turn? A Call to Drop It
Leading audit, tax and business advisory powerhouse Blick Rothenberg is sounding the alarm: the proposed pension tax changes will punish millions of savers and should be scrapped.
Why the Plan Fumbles
Senior Tomm Adams, head of International Pensions and Benefits at Blick, admits he’s hoping the government will reverse the move to bring pensions under inheritance tax by April 2027. “The government treats this as a closed‑door decision, even HMRC won’t debate it,” he says.
But the policy, he argues, is a classic case of double taxation—penalising hard‑working savers and their families, forcing them to rewrite their entire long‑term financial plans.
Impact on the Grandest of Couples
- Unmarried seniors at risk: if one partner passes away and the other needs full‑time care, the pension could have covered those costs.
- Rising care costs: a hike in employer National Insurance Contributions and National Minimum Wage will squeeze budgets even tighter.
- Inheritance tax on pension funds cuts the money that could have been used for caregiving.
Should the Tax Target the Ultra‑Rich?
“If the real aim is to stop the wealthy from passing on excess wealth tax‑free, let’s keep it tidy and only tax pension funds above a certain threshold,” Adams suggests. He proposes linking the limit to the current lump‑sum and death benefit allowance—just over £1m.
Bottom Line
It’s a sly misfire that turns a painstaking, long‑term savings strategy into a painful recalibration. For most, the only reasonable solution is to push for the plan’s cancellation before it takes bite.
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