|
|
Financial advice and services for UK individualsProduct Library: Retirement and Pensions OverviewWhen you retire, you will stop earning money, but you will not stop spending it. Pensions are an incredibly tax efficient way of building a fund or “nestegg” which can be used to provide an income in retirement, and with greater choice and flexibility than ever before, they must be a feature of anyone’s retirement planning.
The UK Government (HMRC) gives tax relief on contributions, effectively meaning they contribute to your pension whenever you do. For example if a basic rate tax payer contributes £80 into their pension, HMRC will add a further £20 making the total £100. It is even better for a higher rate tax payer who is able to reclaim their additional higher rate tax relief either directly or via their tax return. In the above example this equates to a refund of £20 effectively meaning it has only cost them £60 to contribute £100 into their pension. [Please note - you are able to backdate tax reclaims for up to 6 years so if you are a higher rate tax-payer who has been making pension contributions, but not claiming back your additional 20% relief (was 18% prior to April 2008), please visit our downloads section towards the bottom left of the page or click here for a template letter to send off to your tax office]
In addition to the tax relief on contributions many employers will also contribute to your pension plan, either directly or via a salary sacrifice arrangement. So be it your company pension scheme, previous personal pension policies or advanced pension planning like Self Invested Personal Pensions, sufficient financial preparation is essential.
TISCO Financial Planning specialise in the provision of advice on pension planning, helping guide you through the myriad options. But the service does not stop there. When the time comes, choosing the best way to retire, looking at all the new, flexible and tax efficient options, is also incredibly important.
|
