With the UK staring down the barrel of its most severe recession in 300 years, writes Tom Selby, it is important the pension tax system doesn’t unnecessarily penalise individuals responding to these unprecedented circumstances.
We have already seen the Government take a pragmatic and sensible decision to help younger investors. Earlier this month, the Treasury confirmed it would temporarily reduce the Lifetime ISA (LISA) exit penalty from 25% to 20% as part of its response to the Covid-19 pandemic. The announcement will affect withdrawals made between 6th March 2020 and 5th April 2021 and means the charge is designed just to return the upfront bonus for this period of time. The move makes the product simpler for people to understand, and I hope when this is all over the reduced penalty is left in place. I...
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