Pension changes could lead to buy-to-let boom

by Aaron Strutt

Mar 21 2014

There could be a rise in the number of older borrowers investing in the buy-to-let property market after Chancellor George Osborne announced significant changes to pension rules.

From next April, anyone over the age of 55 will be able to withdraw their entire pension from defined pots as a cash lump sum. The first 25% of their fund can be taken as a tax-free lump sum, although they will have to pay income tax on the other 75%. Previously, savers would have paid 55% tax to withdraw the remaining money.

MoneyMarketing has reported that James Lloyd, director of the think tank Strategic Society Centre, said: “The Chancellor has thrown rocket fuel on an already overheated property market, and millions of young first-time buyers will suffer as a result. It is a catastrophic policy decision.”

March 21, 2014