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Pension reforms could create £24bn black hole

by Danielle Levy on May 29, 2014 at 07:52

Pension reforms could create £24bn black hole

Chancellor George Osborne (pictured) may have to amend the sweeping pension reforms announced in this year's Budget, as it emerges they could lead to a mulit-billion pound void in public finances.

The Daily Telegraph reported that Treasury officials have been warned that the government could miss out on up to £24 billion in tax take from pensions as a result of the changes, which include retirees no longer having to buy an annuity. As a result, pensions experts have been called in to the Treasury as part of a consultation into how to implement the reforms.

According to the Daily Telegraph, sources have said the concern is that people will now pay large sums of money into their pensions as they approach retirement and receive tax relief top-ups. They can also find ways of withdrawing their pension savings without paying tax.

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