Standard Life makes pensions calculator prediction

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Standard Life makes pensions calculator prediction

Fri 10th Dec 2010

Standard Life has predicted that new regulations on tax applied to drawn-down pensions will not lead to a flood of consumers withdrawing their funds.

The company explained that while the new reforms bring the duty paid on such transactions down to 55 per cent regardless of the age at death, withdrawals will be sifted through income tax and inheritance tax.

"Whilst flexible drawdown may appear superficially attractive, leaving your savings within your pension will be the best option for the vast majority of people," said head of pension policy at Standard Life John Lawson.

He added that the exemption to inheritance tax and the benefit of gross roll-up are two of the main reasons why deciding against withdrawals will benefit most consumers.

This week, the same company stated that the number of people going through with drawdowns via SIPPs is likely to increase as a result of new government reforms due to come into effect on April 6th 2011.

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