Mr Green is keen to take pension benefits and consolidate his numerous pension plans. He would also like to set up a family pension to include his three children and six grandchildren.
- Mr Green is aged 70 and has a large pension portfolio with a number of providers worth £950,000
- Continues to receive income from business and has disposable income
- Keen to help his children’s and grand-children’s long term futures
- Some of their children are high earners some are low earners
- Transfer pensions into a scheme pension
- Draw a tailored pension income based on his health and chosen investment strategy
- Take maximum pension commencement lump sum (PCLS) (£237,500)
- Invest PCLS into BPR solution (see case studies IHT5 and 6)
- Mr Green to make contributions into scheme pension for children and grandchildren within permitted limits out of excess income.
- Allocate surplus pension funds to other family members
Benefits from advice given
- Creating a pooled fund enables the family members to invest together in a common investment approach
- Can choose between a minimum and maximum income level of Scheme Pension at start
- Income levels tailored to personal circumstances depending on health
- Excess income can be invested into pension for children/grandchildren
- Gains 20%/40%/50% Income Tax relief on pension contributions
- Reducing Inheritance Tax by amount of pension contribution
- Can allocate excess growth on the Scheme Pension to family members
- General fund can be used to pay fees allowing smaller family member pots to grow without the drag of charges
- Inheritance Tax saving of £95,000 after two years on BPR investment.
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We will look to carry out a regular review of your circumstances, objectives, needs and portfolio performance to ensure all arrangements continue to be suitable and advise of any changes that may be appropriate.
This example is for illustrative purposes only, based on current legislation and tax allowances. Tax rules and regulations are subject to change.