From April 2017, the tax and national insurance relief for employer-arranged pension advice will increase from £150 to £500.
Jonathan Watts-Lay, Director, WEALTH at work – a leading provider of financial education in the workplace supported by guidance and advice comments: “We welcome any incentive which gives more employees access to financial advice, particularly when considering retirement income.
“Since the pension changes, we are already seeing an upturn in companies sourcing advisory services for their employees, so this financial incentive is a great helping hand towards the cost of providing it.”
Additionally, the government is to consult on introducing a Pension Advice Allowance. This will allow individuals to withdraw £500 tax free before the age of 55 from their defined contribution pension to redeem against the cost of financial advice – the exact age at which people can do this will be determined by the consultation.
Watts-Lay continues, “Having the ability to pay for advice is so important as so many people go it alone and make poorly thought out decisions. The benefit in improved retirement income can more than out-weight this cost, so taking fully regulated advice