The Times reported earlier this week that uk pension savers now may consider themselves left in limbo, after a recent court hearing around the topic of tax relief.
A court ruled in March that pension savers were entitled to tax relief when they put non-cash assets into a SIPP or a SSAS.
Contributions such as is, known as ‘In-Specie’, have rules that allow savers to put assets such as share portfolios, commercial property or intellectual property into their pensions and receive tax relief.
Last year HMRC said that it would no longer offer pension tax relief on such contributions and argued that the rules say that contributions should only be in cash.
Most pension providers have stopped accepting non-cash contributions as a result, and savers have been left uncertain about their position.
A firm called Sippchoice brought the case to court, making a claim for tax relief on behalf of a client who contributed assets worth over 68,000 GBP to his pension.
The court found in favour of Sippchoice and the ruling may well have opened the door to many more similar claims for tax relief.
HMRC is reportedly looking to appeal the decision however, with Wealth Management firms now clamouring for them to confirm whether they intend to or not – as they need clarity on the situation.
Sippchoice representative Martin Tilley told The Times that he felt that HMRC’s position is odd given that “the rules allow someone to put a cash lump sum into a Sipp and use that to buy some of their non-cash assets, such as a portfolio of shares held in an Isa, and then, once the shares are in the Sipp, to claim tax relief.” Citing that this is essentially a long way around to achieve the same result.
Sippchoice describe themselves as still being in Limbo, despite the ruling.