Panellists at The Buy to Let Market Forum were asked if they thought the Chancellor’s decision to give pension holders the right to withdraw the whole amount would create opportunities for the buy-to-let market.
Matthew Wyles, senior adviser at Castle Trust, said the tax implications of a buy-to-let pension strategy posed risks for advisers as well as consumers.
“I think there are some quite toxic advice risks associated with pension liquidation in favour of any asset class be in property or anything else,” said Wyles.
“Brokers must make sure they do not become the fall guys in 10 years time if you find this is just another pension transfer scandal waiting to happen.”
Moray Hulme, head of sales at Paragon, said the lender is calling on the government to allow buy-to-let property to be included in Self-Invested Pension Schemes (SIPS).
The SIPP acts as a tax wrapper for investments selected by HMRC, which excludes buy-to-let property, that are not subject to a tax charge.
But Wyles said that this was not currently an option for pension holders who will have to face a large bill if they choose to withdraw a sum greater than the 25% tax-free allowance granted by the government.
“I think this is as much about increasing tax returns as it is about creating a deregulated savings market,” he added.
