Care for a tax break? Funding LTC through pension savings

Can it be funded by pension savings?

Carmen Reichman

Experts have called for a tax break on pension withdrawals to help fund LTC. But is such an intervention feasible and a good idea?

Up to a quarter of people in the UK are expected to use long-term care (LTC) at some point in their lives, and with average weekly bills of more than £700 it doesn't come cheap. But Hargreaves Lansdown head of pensions research has a cunning plan. McPhail, along with Defaqto non-executive chairman Patrick Gale, wants the government to change its policy and allow savers access their pension pots tax free if they use the money to pay for their care. After all, specialist long-term care (LTC) immediate-needs annuities are already tax-free when paid directly to a care home. With the op...

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