Pensions confusion taken onboard by Revenue

The Revenue confirms it has received representations for a member taking out a scheme pension which would allow them to generate a larger lump sum by removing all escalation and dependants’ pensions. Conversely, however, through the purchase of a lifetime annuity, the lump sum is capped at 25% of the fund and the member can then decide how much of the residual fund should provide dependants’ pensions and escalation. The government will consult over this ‘mismatch’ and will announce before 2005 Pre-Budget Report should any rules change for the Finance Bill 2006. John Lawson, marketi...