Celebrations on ice: Pensions over-taxation issue not fixed yet

'I'm keeping my celebrations on ice as the biggest issue is still unresolved'

clock • 4 min read

Lisa Webster explores HMRC's shifting stance on pension over-taxation and says while progress is welcome issues still remain...

Exuberant headlines followed the publication of HM Revenue & Customs' (HMRC) January pension schemes newsletter as the revenue finally appeared to be taking steps to ensure pension withdrawals are taxed correctly.  The change being made is welcome, and will improve the situation for many, but I'm keeping my celebrations on ice as the biggest issue is still unresolved. At the heart of the pension over-taxation issue, is the fact that HMRC insists that pension providers apply the relevant tax code to the first pension withdrawal on a "month one" basis. This is irrespective of whether it...

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