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Hi Nick,

Having said that I had no suggestion of how best to characterise the changes made in 2014/2015, I've done a bit of research and think that I can now suggest a reasonable way to characterise the changes.

I stumbled across a "Budget 2014: greater choice in pensions explained" fact sheet (https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/301563/Pensions_fact_sheet_v8.pdf).

Having read that fact sheet (and I appreciate it may not precisely reflect what was to be enacted in law), the focus seems to be on the movement to "full flexibility" when it comes to taking money from a "pension pot" from age 55.

It is not that, prior to the changes, people were required to purchase an annuity (any requirement to do so having been fully removed in Finance Act 2011), but that there were limits placed on the amount that could be taken in capped drawdown and that there was a "penalty" tax charge of 55% if people wanted to "withdraw the whole pot".

So, I'd suggest a reasonable way to characterise the changes made in 2014/2015 would be to say that: (i) any limits on the amount that could be withdrawn from age 55 were removed; (ii) the rate of tax payable on any money withdrawn (above and beyond the tax free amount) was reduced from the "penalty" rate of 55% to the taxpayer's marginal rate of income tax. So, nothing at all to do with annuities.

Best wishes,

Richard.

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