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State pensioners are rushing to open National Savings and Investments Premium Bonds ahead of a rule change. State pensioners are taking action in preparation for a potential raid on pensions from HMRC and the Labour Party government. One told the Telegraph: “The problem is, I have to give a 12-week notice period to take my lump sum out, which would be after the Budget. But I have still asked for a quote to take it out in December.” Chancellor Rachel Reeves is considering cutting the 25pc tax-free allowance for those who want to draw a lump sum from their retirement pot. One retiree will take out his lump sum ‘straight away’ if the Chancellor cuts the tax-free allowance, he said. READ MORE Thousands of Blue Badge holders issued update over free bus travel “I am going to wait and see,” he says. “But if it’s announced, I will take out the rest of my lump sum straight away.” “I am quite fortunate in that I already have a couple of hundred thousand invested,” he says. “But I am loath to give any of that to the Government. My wife and I are planning on travelling – we’ve never been on a cruise.” A second said: “I basically looked at the situation and I figured if I took it out now, I could invest it elsewhere.” “I plan my pension strategy not over six months, 12 months or 18 months – it’s over 40 years. It cannot be right that the Government can come along and potentially slash our allowance with the sweep of a pen,” a third says. “I know if she doesn’t change them [tax rules around pensions], I may be somewhat disadvantaged. But to be blunt, I’m not prepared to take the risk,” a fourth says. “What makes me even more nervous is Torsten Bell. "He’s advocated in the past for reducing the tax-free amount from £250,000 to even £40,000." Another intends to reinvest what he withdraws into Premium Bonds where winnings are exempt from tax. A Treasury spokesman said: “We do not comment on speculation around tax changes but remain committed to encouraging pension saving. “Pension savers already benefit from around £78bn a year in tax reliefs as the majority pay no tax on their contributions.”
