Brace yourself for a pension tax tsunami

Whoever forms the next government, another tidal wave of pension reforms is on the way. Merryn Somerset Webb explains.

Worried about your pension? If you aren't, you probably should be. The last few years have seen a tsunami of pensions reform, culminating in Chancellor George Osborne's dramatic pensions freedom policy and the (not-yet-fully-understood) removal of inheritance tax from all pensions assets. But it isn't over. A quick flick through the tryingly awful manifestos of our top politicians confirms that, whoever wins this week, there is another tsunami on the way.

Labour hasn't said it plans to reverse any of Osborne's changes, but it would surely not be much of a surprise for a Labour government to replace the old death tax on pension assets (it was 55%) with a standard inheritance tax. Labour does, however, intend to have a go at the pension savings relief used by "the rich". Anyone earning over £150,000 a year is to have their relief cut from their marginal rate to the basic rate of 20%.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free
https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up
Merryn Somerset Webb

Merryn Somerset Webb started her career in Tokyo at public broadcaster NHK before becoming a Japanese equity broker at what was then Warburgs. She went on to work at SBC and UBS without moving from her desk in Kamiyacho (it was the age of mergers).

After five years in Japan she returned to work in the UK at Paribas. This soon became BNP Paribas. Again, no desk move was required. On leaving the City, Merryn helped The Week magazine with its City pages before becoming the launch editor of MoneyWeek in 2000 and taking on columns first in the Sunday Times and then in 2009 in the Financial Times

Twenty years on, MoneyWeek is the best-selling financial magazine in the UK. Merryn was its Editor in Chief until 2022. She is now a senior columnist at Bloomberg and host of the Merryn Talks Money podcast -  but still writes for Moneyweek monthly. 

Merryn is also is a non executive director of two investment trusts – BlackRock Throgmorton, and the Murray Income Investment Trust.