Osborne said limits on income drawdown and flexible drawdown would be reduced and trust would be handed over to savers.
He also each and every defined contribution saver would get free impartial advice on how to get the most of their pension”.
Osborne said 13 million defined contribution savers were currently railroaded towards buying an annuity but this would end.
“Tax rules around these pensions suggest pensioners can’t be trusted with their own pension pots. I reject this view,” he said.
Tax charges on lump sums will also be radically changed.
He explained that at present people can take a quarter of their retirement pot free of taxation, but if they want to take more it is subject to a 55% tax charge. However, this will now be reduced to a ‘normal tax’ of 20% for most pensioners.
For full coverage of the Budget 2014, click HERE.
