TaxPersonal TaxDSS threat to small business

DSS threat to small business

Finance directors of smaller companies could be forced to scrap occupational pension provision if the government pushes through its proposed stakeholder scheme, benefit consultants have warned.

Consulting actuaries Punter Southall principal Steve Leake said: ‘Finance directors in the top 200 companies have indicated to us that they will review whether to continue with their existing arrangements, or provide something simpler.’

This could involve lowering contributions to occupational schemes or, for smaller companies, scrapping occupational schemes altogether, he said.

The costs of administering a company programme could be punitive under social security secretary Alistair Darling’s plan that every employee has access to a stakeholder pension if they are not eligible for an occupational pension.

This is alongside the added complexity of introducing a new pension – with its own tax and ownership regulations – which prevents employees from holding occupational and stakeholder pensions at the same time.

Newton Investment Management finance director Russell Vaizey said: ‘There has been a lot of concern from the industry that the public could purchase investment products from outlets such as supermarkets because this could open up opportunities for misselling.’

Other industry insiders expressed concern that companies could effectively cut pension provision in response to the government’s efforts to boost awareness about the importance of financial provision during retirement.

Related Articles

Inheritance tax is 'unfit for modern society' and should be abolished, says think tank

Personal Tax Inheritance tax is 'unfit for modern society' and should be abolished, says think tank

3w Alia Shoaib, Reporter
Rent-a-room relief – the survey says…

Personal Tax Rent-a-room relief – the survey says…

2m Helen Thornley, ATT Technical Officer
What should the OTS prioritise in its review of inheritance tax?

Personal Tax What should the OTS prioritise in its review of inheritance tax?

4m Alia Shoaib, Reporter
LITRG urges government to consider tax changes in disability work plan

Administration LITRG urges government to consider tax changes in disability work plan

5m Lucy Skoulding, Reporter
HMRC appeal rejected in Tottenham Hotspur case

Administration HMRC appeal rejected in Tottenham Hotspur case

6m Emma Smith, Managing Editor
HMRC urged to clarify impact of income allowances on Self-Assessments

Personal Tax HMRC urged to clarify impact of income allowances on Self-Assessments

7m Alia Shoaib, Reporter
New trading allowance: simplicity, but not as we know it

Administration New trading allowance: simplicity, but not as we know it

7m Emma Rawson, ATT Technical Officer
Wealthy individuals could circumvent top tax rate rises

Personal Tax Wealthy individuals could circumvent top tax rate rises

9m Alia Shoaib, Reporter