Natanje Holt looks at the twin issues of falling annuity values and the recent history of GAD income maximums in drawdown and asks the question: Are we simply going ‘back to the future' rather than looking at a more relevant way of calculating income maximums?
Annuity rates have been a worry for pensioners in recent years, particularly those in income drawdown as their incomes have fallen with gilt yield prices. Pensioners in income drawdown saw their income fall significantly over the last few years as the Government's Actuary Department (GAD) maximum annual taxable income was reduced from 120% to 100%. Thankfully the Government took the decision to reverse this change as income levels continued to fall. So from 26 March 2013 it was ‘back to the future' as limits moved back to 120% of agreed annual income limits. These limits are calcul...
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