Government announcements on IHT and McCloud are welcome

Published  23 March 2021
   5 min read

Commenting on today’s papers showing Government has identified tax issues impacting those affected by the McCloud case, Moira Warner, senior intermediary development and technical manager at Royal London, said:

“Royal London is pleased ongoing work to flesh out the ‘McCloud’ solution has identified pension tax issues which will need to be addressed so impacted members receive an appropriate remedy to the unlawful age discrimination. Against a backdrop of escalating disenchantment over wider pension tax issues for higher earners, members need to be confident they will not suffer any financial detriment caused by tax aspects not fully thought through. 

“Although short on detail, it is to be hoped that the anomalous aspects of pension tax law mentioned in the Command Paper include not only the application of Scheme Pays deadlines, but also interaction between the proposed remedy and relevant lifetime allowance (LTA) protections.

“On a wider basis, we would like to have seen the Government take this opportunity to signal its intention to resolve the inequity suffered by lower-earning members of ‘net pay’ pension schemes, including many thousands of public sector workers, who receive no tax relief on their pension contributions because they don’t earn a taxable income.”

Responding to the Government’s changes to requirements when applying for probate or confirmation, Clare Moffat, head of the intermediary development & technical team at Royal London, said:

“The Government has stated that 90% of estates that have no IHT to pay won’t need to report to HMRC when applying for probate or confirmation.  This is a step forward as filling in lengthy forms when there is no IHT to pay is an admin burden that isn’t needed at an already difficult time for families. The Government has said that it will respond to the second IHT consultation so it will be interesting to see what other changes might happen in relation to IHT.

About Royal London

Royal London is the largest mutual life, pensions and investment company in the UK, with assets under management of £147 billion, 8.7 million policies in force and 4,232 employees. Figures quoted are as at 31 December 2022. 

Learn more at

For further information please contact

Lena Nunkoo, PR Manager