UK Missing Out on £2.7 Billion of Pensions Cash

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• £2 billion worth of pension credits will go unclaimed this year
•  Whilst the UK’s retirement savers squander £658 million in unnecessary tax payments

In the throes of the well-documented UK pensions saving crisis, research from IFA Promotion, the organisation promoting the benefits of independent financial advice, has revealed that £2 billion of pension credits will remain unclaimed this year, with between 34% and 44% of pensioners failing to realise their entitlements*.

And what is more, working people in company pension schemes are also missing out on huge sums by neglecting to save in tax-efficient ways. In fact, high-rate taxpayers that are covered for their retirement by a company pension scheme will gift an unnecessary extra £656 million to the tax man this year by failing to make Additional Voluntary Contributions (AVCs).

David Elms, Chief Executive of unbiased.co.uk comments: “Under-provision for retirement remains a crucial problem for the UK and those that are in a position to save more should be doing so. However, it seems that people are compounding the situation – be it through apathy or confusion – by failing to claim vital sources of retirement income in the form of tax credits. Likewise, retirement savers are not making things any easier for themselves by overlooking the need to top-up their company pension pot.

He continued: “No one likes paying more tax than is necessary, and no one likes missing out on something that is rightfully their own, so we are urging people to either kick-start their pension and tax planning or review their current situation with urgency.  A discussion with a local IFA is a great place to start this process.”

As a first step to stamping out this waste, and to claiming tax credit entitlements visit IFA Promotion’s dedicated website www.taketaxaction.co.uk.  The site contains tips on how to save tax, an online tax wastage calculator, and a guide to saving tax. You can also find details of local IFAs who genuinely focus on pension’s advice on the site or by calling 0800 085 3250.

-ends-

Notes to editors

* TaxAction 2006 report produced for IFA Promotion by RAKM, based on a specially commissioned analysis of Inland Revenue and a range of other official data sources. The Department for Work and Pensions calculate that 34-44% of pensioners have failed to claim their pension credits. For detailed research enquiries please phone Paul Hersey of RAKM on 01737 342863

For further information please contact:

For expert comment or case studies from over 200 media-friendly IFAs, journalists should call IFA Promotion’s Media Services hotline on 020 7294 3682 or search online in ‘Media’ at www.unbiased.co.uk

1.      Independent Financial Adviser Promotion

IFA Promotion was established in 1989 to promote the value and accessibility of independent financial advice to the public. It represents around 9,000 firms of independent financial advisers across the UK and is sponsored by 32 leading financial institutions. In the past 12 months, over 530,000 consumers and businesses used IFA Promotion to find local independent financial advice.

IFA Promotion believes Independent financial advice should be:

·         Affordable. The option to take independent financial advice should be available, by right, to all- not just the wealthiest in society.

·         Convenient. IFAs should be available in the location of the consumer’s choice, wherever they live in the UK.

·         Transparent. It must be clearly transparent to consumers who is able to offer independent financial advice and who is not.

2.      Independent Financial Adviser Promotion’s sponsors

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