Only a few days to go: We’re raising £25,000 to keep TheyWorkForYou running and make sure people across the UK can hold their elected representatives to account.

Donate to our crowdfunder

Pensions

House of Lords written question – answered on 7th April 2014.

Alert me about debates like this

Photo of Lord Oakeshott of Seagrove Bay Lord Oakeshott of Seagrove Bay Liberal Democrat

To ask Her Majesty’s Government what is the estimated annual impact on the Exchequer of the tax-free lump sum withdrawal allowance from an individual's pension pot; and what estimate they have made of the impact on the Exchequer of limiting the tax-free lump sum allowance to (1) £25,000, and (2) £30,000.

To ask Her Majesty’s Government, for 2012–13, what was the estimated impact on the Exchequer of tax relief on pension final contributions; how many individuals received it whose top rate of income tax paid was (1) 20 per cent, (2) 40 per cent, and (3) 45 per cent; and what were the estimated total amounts of tax relief given on pension fund contributions to individuals in each of those categories.

To ask Her Majesty’s Government what were the detailed assumptions, including numbers of individuals, amounts withdrawn and behavioural change, for the estimated net impact on the Exchequer of the relaxation of rules governing withdrawals from pension pots contained in the Budget.

Photo of Lord Oakeshott of Seagrove Bay Lord Oakeshott of Seagrove Bay Liberal Democrat

To ask Her Majesty’s Government what were their assumptions about behavioural change by numbers of people buying different types of annuities, including impaired life annuities, as a result of the changes relating to annuity purchases contained in the Budget.

Does this answer the above question?

Yes0 people think so

No0 people think not

Would you like to ask a question like this yourself? Use our Freedom of Information site.

Photo of Lord Deighton Lord Deighton The Commercial Secretary to the Treasury

i.) Estimates of the exchequer impact of the tax free lump sum for pension withdrawals or any capping of it are not available. ii) Tax relief on pension contributions is the primary means by which the government incentivises saving for retirement. In 2012-13, the estimated gross cost of this relief was £34.8 billion which may be found in the published National Statistics produced by HMRC here:

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/285089/PEN6.pdf

The latest available estimates (from 2011-12) of the number of people receiving income tax deductions for their pension contributions and the value of deductions by different income levels can be found in Table 3.8 on the HMRC website at the following link:

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/276037/tables3-1_3-11.pdf iii & iv) The assumptions made around the greater flexibility afforded to pensioners at Budget 2014 — which were certified by the Office for Budget Responsibility - can be found in the 'Budget 2014: Policy Costings' document (p.11). This may be found here:

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/295067/PU1638_policy_costings_bud_2014_with_correction _slip.pdf

Does this answer the above question?

Yes0 people think so

No0 people think not

Would you like to ask a question like this yourself? Use our Freedom of Information site.