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Pension firms fight HMRC's 'in specie' tax demand

Pension providers have launched a legal challenge to HM Revenue & Customs' attempt to claw back tax relief on 'in-specie' contributions.

 

Laight believed the issue was to do with HMRC guidance on the contributions rather than inappropriate behaviour.

However last month HMRC said it will continue to look into in-specie contributions where there are ‘concerns’ over the assets used.

Andy Leggett, head of business development at Barnett Waddingham, a Sipp provider, said: ‘HMRC’s latest newsletter states that their position has not changed: that the only contributions on which tax relief can be claimed are those made in cash. It appears that those using an asset in substitution, even where they follow the steps in the pensions tax manual guidance, cannot be guaranteed that HMRC will give them tax relief.

‘This is not satisfactory. Saving in a pension should not be a minefield: it needs to be clear to savers, advisers and providers what is allowed and what isn’t. The rules should not contain hidden devices, waiting to blow up in the faces of people trying to do the right thing.’

HMRC declined to comment. 

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