Pension changes

Most budget changes are small tweaks to the system and not worth writing about. However, the changes to the pension rules are different.

From April 2015 you will be able to get at all your pension fund. Beforehand you could only take out 25% tax free; you had to buy an annuity (right to income) with the rest.

As well as annuity rates being low, the main issue was that when you died the money used to buy the annuity was lost to the pension company.

The changes mean that you can now pull out all your pension savings, subject to having at least £12,000 of pension income (including your state pension). Yes, you will have to pay tax at the level you would pay tax if you earned extra money but keep in mind:

• Money invested in a pension is tax deductible
• Grow in a pension is tax free

I will be offering all clients a personal financial review where I produce a personal cashflow forecast. This is an ideal opportunity to consider setting up a pension or contributing some extra savings.

Remember that it is possible to control your pension fund via a Self Invested Personal Pension (SIPP). This means it is possible to lend your own company money from your pension fund, or even purchase an asset and lease it to your own company.

There are costs and risks but there are with anything. Whether you should do anything depends on your personal cashflow forecast. If everything looks good then you should look to product and reduce risks.

However, if things are not going to plan it could be worth considering taking some pension savings and investing in your own business.