The States of Jersey have released details of the responses to the consultation on the proposed pensions reforms that were initially announced in October 2013.
The good news is that some additional flexibility is now being proposed, following the feedback received. In addition, the limit on the tax-free lump sum that was proposed initially has now been withdrawn.
BWCI’s Business Development Manager, Mike Freer, said: “The decisions not to increase the minimum retirement age beyond 50 or impose a monetary limit on the tax-free lump sum are to be welcomed. The additional flexibility to take up to 30% of the pension pot as cash in an unlimited number of instalments is great news and should encourage more pensions savings.”
The Treasury and Resources Department have also said that they will monitor the UK Government’s consultation on the UK’s radical proposals, announced by George Osborne in the UK Budget in March. The UK changes would allow full access to pension pots from the age of 55, subject to a tax charge. When the final package of UK changes is known, Jersey's Treasury have said that they will consider if any related changes should be introduced in Jersey.
A change to the Income Tax Law will be required to introduce the changes and this is due to be lodged with the States in July. It is anticipated that the new arrangements would come into force from 1 January 2015.