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 2024/25
The FCA has published retirement income market data for 2024-2025, with key findings set out:
- Total number of pension plans accessed for the first time in 2024/25 increased by 8.6% to 961,575 compared to 2023/24 (885,455).
- Sales of drawdown policies saw the biggest increase from 278,977 in 2023/24 to 349,992 in 2024/25 (25.5%).
- Sales of annuities increased by 7.8% from 82,061 in 2023/24 to 88,430 in 2024/25.
- The overall value of money being withdrawn from pension pots increased to £70,876m in 2024/25 from £52,152m in 2023/24. This is an increase of 35.9%.
- 30.6% of pension plans accessed for the first time in 2024/25 were accessed by plan holders who took regulated advice (down from 30.9% in 2023/24).
- The number of DB to DC transfers continued to fall from 7,181 in 2023/24 to 6,418 in 2024/25.
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
HM Government: Pension Schemes Act 2026
The Pension Schemes Act 2026 includes provisions about pension schemes and connected purposes.
Read more here.
HM Revenue & Customs Technical Note: Inheritance Tax on Pensions
HM Revenue & Customs (HMRC) has published a technical note to provide clarifications on how inheritance tax on pensions will operate on deaths from April 6 2027:
- Most unused pension funds and pension death benefits will be brought within the value of a deceased person’s estate for Inheritance Tax purposes
This will remove:
- Distortions which have led to pension schemes being increasingly used and marketed as a tax planning vehicle to transfer wealth, rather than for funding retirement
- Inconsistencies in the Inheritance Tax treatment of different types of pensions
This change is effective for deaths on or after 6 April 2027 and where a pension scheme member dies before 6 April 2027, the current rules will apply even if pension benefits are paid to their beneficiaries after this date.
HMRC will share draft guidance with industry stakeholders (expected autumn/winter 2026/2027) and intends to publish final guidance in Spring 2027. HMRC will also update tax manuals for April 2027 with detailed guidance on inheritance tax and pensions.
Read the policy paper here.
FCA Publishes Pensions Regulatory Priorities Report
Having confirmed its intention to retire portfolio letters in 2025, the FCA has published its Regulatory Priorities Report for Pensions. This report sets out the FCA’s regulatory priorities for the coming year; namely:
- To ensure well run schemes provide value for money
- To encourage effective support for consumers
- To support growth and innovation
- To modernise pensions and long term savings
To support this work, the FCA has indicated that it aims to publish its VfM policy statement in Q4 of this year, launch a retirement journeys discussion paper in the next quarter and publish its consultation on simplifying the advice rules which, as well as considering streamlining rules related to Ongoing Services, will also bring forward proposals for Simplified Advice.
The FCA has also indicated that it will consult on exempting performance fees from the pensions charge cap.
We would encourage firms to examine the report thoroughly. More generally, we would be extremely keen to hear feedback from firms about these new reports and their usefulness relative to the previous portfolio letters.
Please provide any feedback to Simon Harrington.
Read more details here.
