Private sector pensions being taxed harder than public sector schemes
This is because of the outdated way the taxman calculates the value of salary-linked pensions. As DB pensions are not simply a pot of money, HM Revenue & Customs multiplies the annual income the scheme will pay out by 20. This formula was devised before the lifetime allowance was introduced in 2006 and was based on annuity rates at the time. Annuities are insurance products that can be bought with pension savings and guarantee an income rate until death. But rates have plummeted in recent years — so savers can no longer get as much for their retirement savings. Money Mail calculations tod...