Timmy elsewhere

At the ASI.

Pensions tax relief is not actually a relief, it’s a delay. Which causes something of a problem given that pensions income is subject to all the usual taxes.

12 thoughts on “Timmy elsewhere”

  1. What a great testament to our nation: a policy that’s really popular because nobody understands what pensions really are or how they work. wonderful.
    Could we please morph this discussion into “to which country should I emigrate?”

  2. Osborne is no better unfortunately, with his new limits on pension contributions. How these fuckers have the gall to make it more difficult for people to plan for their future is beyond comprehension.

    Balls policy just goes to show that socialists want the less fortunate to stay that way. /taking money from the succesful does not grow the economy, and hence keeps more people unemployed. Which feeds itself into the cycle.

    I’m a non violent person, but I would make an exception for those low lifes.

  3. The needless tax breaks on pensions for the filthy rich was cured, crudely but effectively, by capping the annual amounts, and cumulative amount, that get the tax breaks.

    This new proposal is just old-fashioned rob-Peter-to-pay-Paul Labourism. Balls isn’t stupid enough to believe what he’s saying, of course, which means that he is a .. what’s the word? … crook.

  4. And as pointed out on Guido Fawkes, this “revenue” and the “tax” on bankers’ bonuses has already been spent several times already in previous policy announcements.

  5. Plus, it’s doubly dishonest because it won’t actually raise any money. The only reason people put up with all the disadvantages of pensions are the tax breaks. Take them away, and people will switch to other types of investment vehicle.

    Add in the increasingly likely possibility that the state will at some point steal a chunk of the pot as well, and we’re fast approaching the point that people will just stop using them.

  6. I’m no accountant, but couldn’t the high earners get around any such changes by using a personal service company? Instead of putting the money into your pension, just leave it in your PSC (albeit invested in the same kinds of funds as a pension). When you come to retire, it gets taxed as income, just like a pension. Does this work?

  7. @ Andrew M

    Or have the employer (and / or PSC) make the pension contributions, and then also avoid the employer’s and employee’s NI – and which already happens to some extent, just for the NI breaks.

    Hence, if serious, they would have to address those issues too. And assuming all UK based…

  8. “…nobody understands what pensions really are or how they work.”

    Yep. Like me and my colleagues – all technical actuaries who understand the minutiae of reserving yet a quick chat about this left us all humming and haaing about the details of how tax reliefs work (general consensus was “leave it to the accountants and pensions scheme actuaries”).

  9. GlenDorran

    Oh don’t be so bloody precious and take offense at what clearly wasn’t aimed at you.

    I shouldn’t need to spell it out, but since you insist (and since a certain ‘expert’ in his field really doesn’t get it):

    Ed Balls says “Look at these rich greedy bastards getting a tax break they clearly haven’t earned because they never earn anything they get do they. I’m going to take their money, which they don’t deserve, and spend it on soemthing fluffy and lovely for your kids, which will work of course.” The country replies, “yes, that’s totally fair, do it Ed.”

    Tim, me, you and a thousand actuaries say “er, but that’s not how pensions work. That’s not how the tax on pensions work”. And the country screams that we are neoliberal wankers who don’t understand that really great ideas are the most simplistic ideas that appeal to our prejudices.

    Now, where do you recommend for me? I always thought Southern Italy, or perhaps Malta. But anywhere around the Med where they don’t give a shit about young people so wouldn’t dream up this bollocks will do me really.

  10. Ironman: I really wasn’t being precious and I’m sorry if it came across that way!!!

    Genuinely, in the discussions I had, me and my colleagues knew the “basics” of tax relief but when we started talking about tax deferral etc then we did start getting a bit sketchy – we aren’t tax experts and we acknowledge that

    I’ll duck out of this and accept that this is another case of intent being misinterpreted via Internet.

    Sorry.

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