The Treasury has changed its mind about allowing the sale of pension annuities.
When pensions flexibility was announced in March 2014, one of the inevitable criticisms was that the reform came too late for those who had already turned their pension pot into an annuity. A year later George Osborne attempted to respond to this complaint by proposing the creation of a secondary annuity market, where annuity owners would be able to sell and then either reinvest within the pension framework or draw out a taxable lump sum.
Mr Osborne’s proposals were met with some scepticism about their viability and in the July 2015 post-election Budget the planned start date was pushed out a year to April 2017. In mid-October 2016, the Treasury announced that “after an extensive programme of engagement with industry, financial regulators and consumer groups,” it had decided to abandon the idea.
Turning your pension fund into an annuity will therefore remain an irrevocable choice. If you are at the point where you need to start drawing income from your pension fund, there are plenty of options for you to consider. The best way to understand these and to decide which options are right for you is to seek expert advice before taking any action. Afterwards could be too late…
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