TaxPersonal TaxPension fund members face 70% tax charge

Pension fund members face 70% tax charge

High Court to rule on whether pension schemes are legal

PEOPLE who draw their pensions early might be liable to pay a tax charge of up to 70% following a case to be heard in the High Court this week.

The court will rule on whether schemes that allow individuals to draw up to half their pension out before the age of 55 are in breach of regulations, The Times reports.

The case, to be heard this week, involves a scheme in which members in two pension funds are encouraged to lend the money to one another. This means they are not directly drawing money from their own pension fund.

HM Revenue & Customs regulations state that early access to pensions is not allowed and could be subject to a tax penalty of up to 70%.

Related Articles

LITRG urges government to consider tax changes in disability work plan

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

20h Lucy Skoulding, Reporter
HMRC urged to clarify impact of income allowances on Self-Assessments

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

2m Alia Shoaib, Reporter
HMRC tax evasion assistance requests double in five years

Corporate Tax HMRC tax evasion assistance requests double in five years

5m Emma Smith, Managing Editor
Rangers tax case to have ‘dramatic’ consequences for football and business

Legal Rangers tax case to have ‘dramatic’ consequences for football and business

5m Emma Smith, Managing Editor
HMRC collects record £5bn in inheritance tax

HMRC HMRC collects record £5bn in inheritance tax

6m Emma Smith, Managing Editor
The top three issues that the next government must address for accountants

Making Tax Digital The top three issues that the next government must address for accountants

6m Emma Smith, Managing Editor
HMRC cuts over 150 offices to reduce running costs

Corporate Tax HMRC cuts over 150 offices to reduce running costs

11m Stephanie Wix, Writer
Finance Bill 2017: Corporate tax reporting requirements 'a burden'

Business Regulation Finance Bill 2017: Corporate tax reporting requirements 'a burden'

1y Stephanie Wix, Writer