Budget Summary 2014 - page 7

page 7
BUDGET
19 MARCH 2014
Minimum pension age
There will be a consultation on a proposal that the minimum
pension age, currently 55, should rise in line with the increase in
the state pension age (SPA). However, the intention is that the first
increase will not occur until 2028, when the SPA will rise to 67 and
the minimum pension age will therefore be 57.
Pensions tax: possible abolition of the age 75 rule
The government will consult on whether the current tax rules that
prevent individuals aged 75 and over from claiming tax relief on
their pension contributions should be amended or abolished.
Voluntary national insurance contributions Class 3A
A new class of voluntary NICs, Class 3A, will be launched, as
previously announced. The aim is to enable those who reach the
SPA before 6 April 2016 – when the new single-tier state pension
begins – to top up their Additional Pension record. The start date
for contributions will be October 2015 and there will be an 18-
month window to make payments. The pricing will be set ‘at an
actuarially fair rate’. The maximum additional amount available will
be limited to £25 a week.
Qualifying non-UK pension schemes (QNUPS)
There will be consultation on giving equivalent treatment to
QNUPS and UK-registered pension schemes. The aim will be to
remove the current opportunities to avoid inheritance tax through
the use of QNUPS.
Individual savings accounts (ISAs)
From 1 July 2014, ISAs will be simplified with the creation of the
‘New ISA’ (NISA). All existing ISAs will become NISAs. From 1 July
2014, the 2014/15 overall annual subscription limit will be
increased from £11,880 to £15,000. All of the new limit may be
invested in cash deposits, rather than the current 50%.
NISA investors will be able to transfer their investments from a
stocks and shares ISA to a cash ISA. Currently transfers are only
possible from cash ISAs to stocks and shares ISAs. There will be
revisions to the rules on eligible investments to allow a wider range
think ahead
Maximise pension tax
relief while you still can.
The pension annual
allowance is cut to £40,000
in April 2014 and the
lifetime allowance falls to
£1.25 million. Take
advantage of the generous
carry forward rules and, if
appropriate, the new
transitional protection
options to maximise your
retirement provision while
you still have the
opportunity.
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