Spence & Partners welcomes the creation of a Lifetime ISA but said it was unfortunate that the current pensions tax system was still in place.
Brian Spence, at Spence and Partners said: “What’s not to love about the Lifetime ISA compared to the complex pension tax system? The snag is the government bonus stops at 50 and if you are over 40 before April 2017 – tough luck!
“Young people however get a Government bonus of £1,000 for each £4,000 and you can take it out whenever you want if you need it but lose the government bonus until age 60. For young workers it is a “no-brainer” – max out your Lifetime ISA before you even think about pensions saving with its complexity, tie-ins, charges and near certainty of political interference.
“It is a pity the Chancellor did not take the bolder step of killing the current pensions tax system once and for all – but he may well have landed a significant blow!
“The Lifetime ISA is clearly the shape of things to come.”