The UK pension system is set to be simplified on 'A-Day', April 6, 2006, when the same tax rules will cover all pension arrangements.
In order to help consumers understand how the new rules will affect them, the Association of British Insurers (ABI) and the Association of Independent Financial Advisers (AIFA) have published a factsheet explaining the changes.
Helen McCarthy, the ABI’s head of pensions and savings development, said:
A-Day will bring in the most significant changes to pensions for many years. We hope that the new, simplified arrangements will help to encourage more people to save more for their retirement.
Fay Goddard, AIFA’s deputy director general, added: Pensions simplification will not just affect high earners. Many of the changes are relevant to anyone with a pension and the factsheet will raise awareness of the key points to look out for. We hope it will encourage people to seek advice where required.