Background

Male client aged 60. Legal Director of large firm of solicitors in Birmingham. He had a number of pension arrangements through various past employments. He was unsure of his overall financial position and when he could retire.

Challenges

1. Pension Position

• Client wanted to know what he had in terms of pension provision
• Wanted to know what to do with the various pension arrangements
• Wanted to know what his options were in terms of taking benefits

2. Employment

• Not sure how long he will continue working
• Not sure how much he will continue to work for

3. Position on death

• Worried about potential Inheritance Tax liability on death

What we did

• Simplified and consolidated most of existing pension arrangements
• Gave him a clear view of what he could expect from his pension arrangements
• Explained all options in relation to taking benefits and how this could be structured tax-efficiently
• Set up trust in connection with new pension arrangement
• Introduced structured review programme to consider ongoing income needs

The results

• Gave client control of his pension investments, creating peace of mind
• Reduced paperwork and complexity of arrangements
• Reduced potential Inheritance Tax liability by £80,000
• He reduced hours to work part-time initially and then retired and took up temporary positions on his terms
• In process of arranging a tax efficient ‘income’ so as to avoid higher rate tax liability