IR proposals up mis-selling risk, says Drawdown Bureau

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There is potential for another mis-selling scandal if the Inland Revenue's proposals on income drawdown, which will give consumers more flexibility to choose how much money to withdraw, come into force, warns the Drawdown Bureau.

The IR's tax simplification paper on pensions suggests the calculation of drawdownincome limits should be directed linked with changing annuity rates, includinga minimum limit of just £1 per annum. The proposals would benefit consumers because they leave future limits wide open, the Drawdown Bureau (DB) says. Consumers would be able to better tailor income requirements and plan investment strategies with more flexibility than under current legislation. Currently, the maximum income drawdown limit for a 60-year old man with a fund of £250,000 is £19,500 per month, DB says. The Governm...

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