Just 8 months ago this Government re-instated Pension Term Assurance which it did away with several years ago when they ballsed up the introduction of Stakeholder Pensions.
After pressure from the industry, the consumers association, uncle Tom Cobbly and all they re-introduced it as part or their Pension Simplification regime that was indroduced in April this year.
Now it seems that Gordon is going to scrap it! see below:-
Does anyone still think this lot actually know what they are doing??????
BREAKING NEWS - "Cover" magazine 06 12 06
PTA MAY BE SCRAPPED
Pension term assurance (PTA) looks set to be scrapped from 1 April next year, the Pre-Budget Report has revealed.
According to the report, published Wednesday midday, the Government has decided to review the tax relief option on PTA with the view to possibly getting rid of the tax relief option on life insurance policies. The report revealed that any changes the Government decides to make will not affect any arrangements entered into before 6 December 2006.
The news has caused uproar in the industry.
Commenting on the news, Andy Milburn, IFA market manager at Royal Liver, said: "This doesn't give us enough to go on. Our understanding is that it puts PTA tax relief under review. Providers over the next few days will have to decide if they need to withdraw the product from immediate sale or choose to continue to allow customers to purchase it but with a caveat that tax relief could end next year. The Government isn't treating customers fairly. Providers without a switch option and providers with limited switch options now need to consider their positions with regards to customers who have bought PTA with them since 6 December 2006."
Jon Briggs, head of protection research at Hargreaves Lansdown, said: "This is yet another U-turn in legislation from a Government that doesn't seem to understand the unintended consequences of legislation that came into force only eight months ago today. This is so unhelpful in closing the £2.3trn protection gap and will simply mean a 15% average increase in life insurance premiums for those wanting to financially protect their loved ones.
"PTA effectively gave income tax relief on life insurance premiums at a person's highest marginal rate. For most people this was 22%, but for higher rate taxpayers it was as high as 40%. Most people aged less than 75 in the UK could benefit from this break, although wealthy people with large pension pots might not have been eligible," he added.
Johanna Gornitzki
Editor
After pressure from the industry, the consumers association, uncle Tom Cobbly and all they re-introduced it as part or their Pension Simplification regime that was indroduced in April this year.
Now it seems that Gordon is going to scrap it! see below:-
Does anyone still think this lot actually know what they are doing??????
BREAKING NEWS - "Cover" magazine 06 12 06
PTA MAY BE SCRAPPED
Pension term assurance (PTA) looks set to be scrapped from 1 April next year, the Pre-Budget Report has revealed.
According to the report, published Wednesday midday, the Government has decided to review the tax relief option on PTA with the view to possibly getting rid of the tax relief option on life insurance policies. The report revealed that any changes the Government decides to make will not affect any arrangements entered into before 6 December 2006.
The news has caused uproar in the industry.
Commenting on the news, Andy Milburn, IFA market manager at Royal Liver, said: "This doesn't give us enough to go on. Our understanding is that it puts PTA tax relief under review. Providers over the next few days will have to decide if they need to withdraw the product from immediate sale or choose to continue to allow customers to purchase it but with a caveat that tax relief could end next year. The Government isn't treating customers fairly. Providers without a switch option and providers with limited switch options now need to consider their positions with regards to customers who have bought PTA with them since 6 December 2006."
Jon Briggs, head of protection research at Hargreaves Lansdown, said: "This is yet another U-turn in legislation from a Government that doesn't seem to understand the unintended consequences of legislation that came into force only eight months ago today. This is so unhelpful in closing the £2.3trn protection gap and will simply mean a 15% average increase in life insurance premiums for those wanting to financially protect their loved ones.
"PTA effectively gave income tax relief on life insurance premiums at a person's highest marginal rate. For most people this was 22%, but for higher rate taxpayers it was as high as 40%. Most people aged less than 75 in the UK could benefit from this break, although wealthy people with large pension pots might not have been eligible," he added.
Johanna Gornitzki
Editor