Finance Bill 'quietly' closes tax loophole says Abbey

AfI says amendments to the Inland Revenue's pensions simplification proposals have introduced a "back door" tax which will affect people opting for income drawdown. Under previous proposals, personal pension rules provided that if a member died before vesting and their spouse or dependants chose to take income drawdown, but subsequently themselves died before purchasing an annuity, the remaining fund could be paid as a lump sum withou incurring a 35% tax charge, AfI explains. However, this will no longer be possible as it appears the Revenue has closed the loophole by stating in the F...