Royal London has said it’s started to see an increase in people asking to take their tax-free cash due to Budget speculation – but the actual number taking it out remains low, as they mostly are advised clients.
The company said some clients are worrying about a reduction to tax-free cash and may be deciding to bring their plans forward ahead of the Autumn Budget.
Clare Moffat, pensions and tax expert at Royal London, told International Adviser: “While Royal London has started to see a slight increase in customers asking about taking tax-free cash as a result of speculation, there hasn’t been a significant increase in those taking it.
“Some people might be worried about a reduction to tax-free cash and decide to bring forward their plans by a few months. For others, bringing forward a key element of their retirement planning could have more significant implications for their retirement.”
It comes after FCA data showed a huge uptick in people pulling tax-free cash out their pensions last year around the Budget. HMRC and the FCA confirmed last month that people taking tax-free cash cannot lean on cancellation rights to put the money back in without tax consequences.
