GOVERNMENT advice to new pensioners should include guidance on getting the best tax deal, finance firm Zurich argued today.
New rules mean retirees will be freer to choose how to spend their pension pot, rather than being compelled to buy an annuity.
But that means they may face varying degrees of tax liability, depending on how quickly the pensioner draws down savings.
“Most consumers will be unaware of the implications of the new changes,” the firm said in its response to the Financial Conduct Authority’s consultation.
“These include the higher taxes they can face by unlocking their full pension savings instead of spreading them out over several years.”
The government wants to give advice to pensioners, and is consulting on the scope of that offer.