PIMFA
Pensions
For most people, their pension represents the largest source of wealth that they will accumulate over their lives. In accumulation and decumulation the wealth management, financial advice and planning industry provides a reassuringly regulated and professional service that puts the customer at the heart of everything they do.
This has become increasingly complex for firms over the preceding decade as they have sought to navigate a changing regulatory environment. Despite substantive reforms such as the introduction of automatic enrolment, pension freedoms, changes to pension transfer advice and more, pensions continue to be a subject of reform from Regulators and the Government. Over the coming years we believe that we see more consolidation of pension schemes, further drive towards value for money, and a drive to focus the way in which and where these schemes invest. Where these reforms directly impact PIMFA firms, we will engage on your behalf to secure change in your interests.
- FCA Retirement Income Market Data 2023/24
The FCA has published retirement income market data for 2023-2024, with key findings set out:
- Total number of pension plans accessed for the first time in 2023/24 increased by 19.7% to 885,455 compared to 2022/23 (739,652).
- Sales of annuities saw the biggest increase from 59,163 in 2022/23 to 82,061 in 2023/24 (38.7%).
- Sales of drawdown increased by 27.9% from 218,183 in 2022/23 to 278,977 in 2023/24.
- The overall value of money being withdrawn from pension pots increased to £52,152m in 2023/24 from £43,233m in 2022/23. This is an increase of 20.6%.
- Some 30.9% of pension plans accessed for the first time in 2023/24 were accessed by plan holders who took regulated advice (down from 32.9 % in 2022/23).
- The number of DB to DC transfers continued to fall from 18,080 in 2022/23 to 7,181 in 2023/24.
Access the publication here.
- Our Latest work
FCA DP24/3: Pensions: Adapting our requirements for a changing market
PIMFA Responds to FCA DP24/3: Pensions: Adapting our requirements for a changing market
Read the response here
This guide provides a review of the FCA policy statement on pension transfer advice.
Latest News
Pensions Commission 2.0
The Government has moved on to the second phase of its Pensions Review by reviving the Pensions Commission, which was responsible for the introduction of automatic enrolment. The Commission will look at methods to increase retirement adequacy for savers.
PIMFA supports the aims of this Commission and where possible will look to feed into this process.
Interested firms should contact Simon Harrington
Inheritance Tax on Pensions
HM Revenues and Customs (HMRC) has issued a summary of responses following the technical consultation that took place over the winter. The message is clear that the government still intends to bring unused pension funds into the scope of inheritance tax and the consultation related to process only.
Feedback has prompted a number of changes including:
- The primary burden for reporting and paying inheritance tax has moved from the Pension Scheme Administrators to the Personal Representatives
- All Death in Service benefits from registered pension schemes will be out of scope of inheritance tax
A full summary of responses and draft legislation can be found here. Comments on draft legislation must be submitted by 15 September. If you would like to discuss this further, please contact Julia Sage-Bell.
