Unsecured Pension Age Increased to 77
From the 2011/12 tax year the Government will end the requirement to secure pension income from age 75. It will consult with the relevant parties on this issue, but in the meantime it will introduce a transitional measure for those under age 75 on 22nd June 2010.
The transitional measure will increase the age that pensions need to be secured to 77 with effect from 22nd June 2010 subject to legislation. This in effect extends the maximum period of Unsecured Pension by 2 years.
However, not everything linked to age 75 will be replaced with the new age 77. For example the right to a pension commencement lump sum will cease on attaining age 75 and it will not be possible to defer crystallisation of benefits past 75.
The application of IHT to any lump sum death benefit in unsecured pension will extend to age 77. In addition any lump sum death benefit payable will attract a standalone tax charge of 35%.