This policy is intended to safeguard the future of the State Pension and ensure all eligible older people receive a payout, but those living abroad now face losing out on this benefit.
In some sectors, Brexit appears to be having a negative impact due to labour shortages. This coupled with the pandemic, has seen a reduced number of retail and hospitality workers, which could impact on company profitability.
However the government is committed to making the most out of Brexit. So to the extent areas of bureaucracy are sensibly cut, the impacted sectors could benefit positively.
FTAdviser: Can we expect any big changes from the government over pensions in the next couple of years, or will they remain stable?
RS: Following the pandemic, the pressure is on for current and future governments to deliver policies that balance public finances.
The chancellor has already made some notable decisions such as freezing the Lifetime Allowance for pension contributions at just over £1m for the remainder of this Parliament, instead of increasing in line with inflation.
[At the time of writing, plans have been leaked that suggest the chancellor might even reduce the LTA and make tax changes to pensions later this year to help plug the Covid-19 economic hole].
RS: Look, as we look towards an uncertain future, this could realistically pave the way for significant changes in pension policy. Certainly at PensionBee, we would welcome a reform of the pension tax relief system, as it is not currently fit for purpose.
The introduction of a flat rate of pension tax relief would benefit the hard-working savers who continue to not receive enough, while, at the other end of the spectrum, benefitting higher and additional-rate taxpayers, who are likely to be missing out on approximately £1bn in unclaimed tax relief each year by not completing their self-assessment.
The dual system is too complex and radical reform is long overdue. A universal rate of 25-30 per cent will level the pensions playing field and put a stop to savers across all tax brackets missing out.
Joy Brooks-Gilzeane is an intern with FTAdviser
