Mailings

Monday 1 December 2008

Pre budget report 2008

The Chancellor's Pre Budget Report was delivered on the 24th November 2008. As far as pension schemes are concerned, this involved one significant announcement:

The Lifetime Allowance and Annual Allowance, which were introduced at Pension A Day on the 6th April 2006, are not to be increased beyond April 2011. At this point, the limits will be restricted to a maximum fund size of £1,800,000 across all pension arrangements and a maximum annual contribution of £255,000 to all pension arrangements.

It had been generally understood that from April 2011 these limits would increase annually as they currently do. The announcement that they will remain constant until the 5th April 2016 at the earliest comes as something of a shock (although not altogether a surprise).

Another important announcement is the reduction in VAT to 15% which is effective from the 1st December 2008 to the 31st December 2009, and means VAT on our fees will be reduced accordingly. Our literature will be amended to reflect this in due course.

An independent review on offshore tax havens has also been revealed, which may affect the Qualifying Recognised Overseas Pension Scheme (QROPS) landscape, although we will have to await the outcome.

The IPS Partnership