Swap your pension for cash
More than five million pensioners who bought annuities will be able to swap their guaranteed income for a cash lump sum from April 2017, the Treasury has today confirmed. The move to create a new “secondary annuity market” is an extension of the Government’s landmark pension freedoms first announced in 2014, and applying from April 2015. Now the Government has said that from April 6, 2017, tax restrictions for people looking to sell their annuity will be removed, giving pensioners with an existing annuity – and anyone who purchases an annuity in the future – the ability to sell it on for cash. Currently someone wanting to sell an annuity to a willing buyer would face a tax charge of up to 70pc. The government will scrap this, so people are taxed only at their marginal rate. The move will be beneficial for those who can swap small or negligible annuity payments for a single, lump sum.
Sell your pension and how would it work?
It’s been the dream of many an unhappy annuity buyer: sell the policy back to the insurer for a cash lump sum. And now the Government wants to make it a reality.
Read more on this article: The Telegraph